The European Response to Chinese Outbound Foreign Direct Investment: Introducing a Dynamic Analytical Framework

Since the turn of the 21st century, the emergence of Chinese outbound investment has been one of the most prominent features of globalization. Its trajectory has been notable both for its speed and scale and for its global dispersion. Since the early 2000s, Chinese outbound investment has grown rapidly from a very low base that predominately involved South–South flows, expanding into the global North. The idiosyncratic nature of Chinese investment has generated diverse responses over time from the countries of the developed world. The policy dilemmas that Chinese investment creates for the latter economies is manifest in their fragmented reactions and in the degree of contestation around policy responses. In the light of the recent increasing backlash towards investment by Chinese multinational corporations (MNCs) in much of the developed world, this article introduces a dynamic analytical framework that is able to assess the response to investment by Chinese MNCs in Europe, and examines the implications of that response for China and its corporations. By doing so, this article contributes to the debate on Chinese globalization and further elaborates on the so-called ‘China anxiety’ issue.