This report was published as an open source publication by LeidenAsiaCentre in December 2018.
China’s role as a global investor and financier has grown rapidly in recent decades, nowhere more so than in Europe. In 2017, a full quarter of China’s outbound foreign direct investment was destined for Europe. China has stepped up promotion of its signature Belt and Road Initiative (BRI), with Europe as its final destination, ever greater flows of investment in Eurasian connectivity are on offer. However, in recent years scepticism about rising flows of Chinese investment into the EU has grown.
This report aims to carefully scrutinize the linkage between Chinese investment in Europe and China’s influence in the region and provides a nuanced and careful analysis that goes beyond the alarmism and polarization that dominates so much of the recent discussion about China’s role in Europe.
It is based on a series of case studies examining a Chinese port investment in Greece, a Chinese-financed rail project in Hungary and Serbia, and two Chinese acquisition deals in the Netherlands. Thus, the authors shed light on the motives behind these individual Chinese investments and financial packages, including the interests of both the Chinese and the host governments and firms involved, evaluating what, if any, Chinese “influence” can be linked to the deals. According to the findings, the specific terms of each investment or loan package are dependent on the individual circumstances of the countries and firms involved. In each case there is an identifiable commercial basis for the Chinese investment, but economic and political viability of each deal varies.