Perceptions of China’s outward foreign direct investment in European critical infrastructure and strategic industries

Abstract

This study analyses impacts of China’s outward foreign direct investment on host country policies and on the bilateral relationship with China by unravelling European and Chinese perceptions. We compare how China’s takeover of German robotics manufacturer KUKA AG and the investment into nuclear power project Hinkley Point C in the UK were perceived amongst European societal, economic and political stakeholders. Based on media articles, companies’ statements, political statements and interviews in China and the UK, we argue that China’s investments in Europe lead to threat perceptions amongst host country stakeholders and fuel debates on whether and how to regulate deals that could harm security and technology interests. While rising threat perceptions have already altered FDI policies in the UK, the German case inherits the potential to alter economic policies.