Chinese FDI in the United States and Europe: Implications and Opportunities for Transatlantic Cooperation

Issues such as trade, exchange rates, market access, and enforcement of intellectual property rights have long dominated the economic policy of the United States and Europe toward China. Beyond this familiar laundry list, a new topic was emerging: Chinese direct investment in the United States and Europe.

China’s outward foreign direct investment (OFDI) had been growing fast for the past decade buy flows to developed economies were very limited. Then Chinese direct investment in Organisation for Economic Co-operation and Development (OECD) countries was taking off and flows to America and Europe were poised to grow substantially over the next decade. The heated reactions to recent Chinese investments illustrate that the United States and Europe were not yet ready for the coming surge of FDI from China. Policymakers urgently needed to address related questions and formulate a coherent response. As the United States and EU member states were facing similar challenges from rising Chinese investment, there were plenty of opportunities for greater transatlantic cooperation.