Abstract

• China’s global outbound FDI continued to surge in 2015 and the Chinese leadership touts investment as a new pillar of China’s positive contributions to the global economy.
• Chinese OFDI in Europe hits another record high in 2015, highlighting the potential for China as a source of productive capital but also reinforcing existing concerns.
• The new realities of slower growth and transition to a new economic model explain Chinese investors’ focus on advanced industrial assets, modern services, and real estate.
• State-owned investors continue to account for a majority of China’s EU OFDI, and new  financing entities could further boost the role of state capital.
• Chinese investment increasingly extends beyond the “Big Three” economies (Germany, France, UK), fuelling the intra-European competition for Chinese capital.
• Germany remains one of the most appealing destinations for Chinese investors looking for technology, consumer markets, and safe haven assets.
• China’s global investment boom is unlikely to end any time soon but China’s fight against capital flight and bad debt pose short-term risks for 2016.​