Thursday , January 27 2022

China 2018 FDI to North America, Europe is 73%: Baker & McKenzie


China's foreign direct investment in North America and Europe declined by 73 percent last year to six years, as the US tightened its business and China's restrictions on foreign investment, Baker & McKenzie said.

These figures reflect the impact of trade and political bottlenecks between Washington and Beijing. Considering the divisions, net Chinese FDI flows to the US actually became negative.

Investments in the United States fell by 83 percent and in Canada by 80 percent. In Europe, despite the general decline, China's FDI has also increased to countries such as Germany, France and Spain.

Finished Chinese FDI transactions in two Western regions dropped to $ 30 billion in 2018 from $ 111 billion in the previous year, Baker & McKenzie said in a report prepared by the research company Rhodium Group.

Even after ChemChina made a $ 43 billion takeover of Syngenta in 2017, the transaction volume fell by 40 percent.

The tighter regulatory review also led to the cancellation of 14 Chinese investment transactions in North America, worth US $ 4 billion, and seven in Europe, worth $ 1.5 billion.

"Some deals are still being made despite new investment control regulations, trade tensions and Chinese investment controls," said Michael DeFranco, global manager of Baker McKenzie.

"But all parties involved must carry out a thorough scrutiny and make in-depth recommendations to assess whether the transaction is viable."

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