Abstract
China’s outward FDI reached a peak in 2016, making it as important a foreign investor as Germany, France and the United Kingdom. In this paper, we investigate the main motivations behind Chinese investments in developing countries, Central and Eastern Europe (CEE) in particular. Although the size of Chinese investment in CEE is small, the region is strategic for China as it is a gateway into Western Europe under the Belt Road Initiative. As new or future members of the EU, the CEE countries also provide access to the single market. We find that the motivations to invest in developing countries differ according to regions. Based on outward FDI data provided by the Chinese authorities, the number of Chinese FDI greenfield and M&A projects from Financial Times and Zephyr respectively, as well as face-to-face interviews with companies with investments in CEE, we find that for the case of CEE, domestic markets, access to the larger EU market, strategic assets like technology and prior relationship with the CEE are main reasons for investing.
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Notes on contributors
Bala Ramasamy
Professor Bala Ramasamy is Professor of Economics at China Europe International Business School (CEIBS). His research interest focuses on Asian economies, Foreign Direct Investment, Corporate Social Responsibility and International Business Strategy. His research has been published in the Journal of Business Ethics, World Economy, the Journal of World Business, the Journal of World Investment and Trade, the Journal of Business Research, among others. His views are regularly sought by the media. He has been interviewed by CCTV, Bloomberg, AP, Al Jazeera, Channel NewsAsia etc. His comments have also appeared in the Wall Street Journal, China Daily, Global Times and other newspaper around the world.
Matthew Yeung
Dr Matthew Yeung is Associate Professor of Research Methods at the Insitute of International Business and Governance of the Open University of Hong Kong. His research interest focuses on International trades, Foreign Direct Investment, consumer sentiment and Big Data Analysis. His research has been published in the Journal of Business Ethics, World Economy, the Journal of World Business, the Journal of World Investment and Trade, the Journal of Business Research, among others.