China is now looking to put down roots on its European neighbors as it is now shifting its investment focus away from North America, new financial reports revealed.
According to Xinhua Net, the first six months of 2018 saw foreign direct investment (FDI) from Chinese enterprises into Europe already reaching $22 billion as compared to the meager $2.5 billion FDI made in the US.
In the first two quarters of last year, Chinese FDI in America reached $24 billion but ever since the new US trade policies kicked in, almost 95 percent of the investment fell. This happened in just a span of 12 months, signifying the severity of the trade conflict which was instigated by the Trump administration.
Meanwhile, this situation was a far cry from what is currently happening with China and Europe.
The influx of Chinese FDI into the continent was directly attributed to factors including "political relations."
"Regulatory hurdles remain lower, political relations are more predictable and Europe offers a great base for industrial high-tech assets, which is a good match with Chinese regulators' outbound investment priorities," Thilo Hanemann of Rhodium Group said.
Hanemann's agency, in cooperation with an international law firm, Maker McKenzie, was behind the research.
Countries like the UK, Germany, France, and Sweden, to mention a few, are now the popular destinations for Chinese investments in this year, so far.
An earlier report cited the growing economy as well as political cooperation between the Asian powerhouse and France. One of the manifestations of this burgeoning relationship is the construction of the FrenchDreamTowers in Hangzhou, in China's Zhejiang province.
With Sweden, Chinese investment companies were already pouring in $3.6 billion, just for the past six months alone. It is expected to bloat as more and more firms are joining in the investment foray.
The same favorable situation is happening in the German and UK markets who both received a total of more than $3 billion of investments.
A CNBC report went on to reveal another $5 billion of pending capital that is yet to be released by Chinese firms.
Daniel Zhang of Baker McKenzie believed in China's "vital role" being played in changing the landscape of global economy. He went on to say that this trend of overseas investment trade will continue at a "more measured and sustainable pace."
All the while, the US continues to tighten its trade regulations with the intent to hurt Chinese tech industries. Just recently, the White House hit Chinese telecom manufacturer ZTE, banning its operations at home.
