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Servicing Chinese Overseas Foreign Direct Investments: Overview and How to Work with Chinese Investors

By EUSME Centre | Press Article      28.11.2017     Tags:

Bruxelles, November 27th - Together with Stockholm Business Alliance, Invest in Stockholm, ALMI Uppsala and China IPR Helpdesk, the EU SME Centre organized two trainings on Servicing Chinese Overseas Foreign Direct Investments, on 23 November 2017 in Uppsala and on 24 November 2017 in Stockholm.

Olof Zetterberg, CEO of Stockholm Business Region AB welcomed the participants in Stockholm, promising that “Stockholm wants to become more China-friendly, welcoming even more investments from there”. 

The aim of the workshop was to inform the Swedish small and medium-sized enterprises about the background of Chinese investments, their motivation and how European businesses can position themselves in order to attract Chinese OFDIs. 

Prof Haiyan Zhang, EU SME Centre expert, delivered most parts of the workshop explained the different types of investors who can be either State Owned Enterprises (SOE), Privately Owned Enterprises (POE) or the so-called “suitcase investors” who are usually represented by individuals or Chinese families. 80% of the investments from China into Sweden were performed by POEs. In terms of cumulated investments into EU, Sweden is ranking fifth after the Netherlands, the UK, Luxembourg, Germany, and France.

There are four main reasons for Chinese investments around the world:

The rise of protectionism around the world triggers Chinese government to encourage their companies to buy into Western companies in order to offer local products. On the other hand, Chinese companies want to move up in the value chain, being able to offer products in the “good-enough market”. Thirdly, the Belt and Road Initiative (BRI) initiates a new internationalization model for Chinese companies, which is seen as a complementary model of the Chinese government to fill a wide range of investment levels. To mention lastly are the Chinese investments, which are done to acquire well-established brands to get them into China. 

All these factors make China the second biggest investor today, only surpassed by the US in terms of investment flows. In cumulated numbers, China ranks as a 6th investor worldwide today.

An important complementarity to the investment overview and ways to work with Chinese investors was Valentin de le Court’s presentation, which looked into the IP angle of Chinese investment. Mr de le Court is an expert from China IPR Helpdesk, another European initiative helping European SMEs in China.

He informed the participants about the peculiarities and the history of the intellectual property rights laws, which are fairly new to the Chinese legal landscape. Despite this, IP is a top priority for China today since China’s self-proclaimed aim is to become an innovation-based economy by 2020 and be a global innovation leader by 2050.

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