European nations come calling

EU wants more Chinese investment in green energy, high-end technology

European nations are rolling out the red carpet to channel the outbound investment surge from China to their shores, particularly in sectors like high-end technology and green energy.

Though much of the Chinese investment in the European Union has been in the machinery, mining and agricultural sectors, green energy and high-end technology are being viewed as hot targets for investment, says a recent report from the China Council for the Promotion of International Trade.

"We are keen to see more Chinese investment in sectors like green energy and innovation projects in the Netherlands. We are hopeful of attracting big Chinese companies like Huawei to invest in our nation," says Rudolf Bekink, Dutch ambassador to China.

"Netherlands has a flexible tax policy for the green energy sector and has advanced ports that are capable of handling the surge in traffic. We also have cordial and friendly ties with most of our investors," Bekink says.

Chinese investors from the non-financial sector have made direct investments totaling $8.5 billion (5.74 billion euros) in 974 overseas enterprises in 98 countries and regions around the world during the first quarter. Direct investment from non-financial sectors in the EU was up by about 150 percent to $490 million during the same time.

Markus Hempel, chief representative of investment and promotion in China for Germany's Trade and Invest Agency, says many Chinese investors are now keen on investing in the renewable energy sector in Germany.

"We have well-developed infrastructural facilities, research institutes and fluent Chinese-speaking German employees to help Chinese companies invest in Germany. Our government is also simplifying the application procedure for Chinese companies," he says.

"During the last five years, the influence of Chinese investment in Europe, especially in Germany has been growing and is now integral to German economy. Currently, we have more than 1,000 Chinese companies in Germany, and more than 10,000 German employees have already worked for Chinese companies," he says.

Last year, Chinese companies invested in 3,125 overseas companies in 129 countries and regions, with total direct investment in non-financial sector up by 36 percent year-on-year to $59 billion, according to the Ministry of Commerce.

China has also become the world's second largest acquirer of foreign companies, after the United States, according to data from the Chinese Academy of Social Sciences.

Bernard Flory, chief representative of France's Moselle Provincial Development Agency in China, says his province and nation are keen on seeing more Chinese investment in the region. "We are also good at machinery making and located close to Germany and Belgium, making it an ideal location for business trips, logistics and multilateral trade."

According to Flory, China is definitely the outbound source of investment to Europe, particularly to France. His province is also keen on wooing more Chinese investors and plans to support their development/investment by finding partners and buyers in Europe.

Wu Shanshan, chief representative of the Austrian Business Agency in China, says Austria is also a good investment destination.

"Compared with Amsterdam or Brussels, the rentals in Vienna are cheaper for companies and an ideal location to set up their headquarters or offices. The city also has many meeting and conference venues and is fully geared up to meet the needs of Chinese companies.

"New energy automobiles, chemistry, telecommunication, biology and steel-making are the most advantageous industries in Austria. Air China, China Ocean Shipping Group Co (COSCO), Huawei, ZTE and Shougang Group are already major investors in Austria."

Wu says that it takes only two weeks to obtain investment permission in Austria and also comes with tax reduction and financial subsidies for green energy and high-end technology investments.

"The central government is also hoping that the outbound investment surge will help in diversification of its foreign exchange reserves," says Liu Wenge, professor of international trade at the Central University of Finance and Economics in Beijing. China's foreign exchange reserves, the world's largest, hit $3.04 trillion by the end of March.

Sun Lujun, director of the capital management department of the State Administration of Foreign Exchange, says the government will take more steps to facilitate overseas investment and better support companies seeking markets overseas.

The Chinese government is making effort to develop its own intermediary agencies for overseas investment, and also recruited a large number of employees who are legal professionals, European language speakers and business major graduates.

Sun says that China will continue to loosen restrictions on capital control to further stimulate overseas investment.