Chinese firms in EU plan more investments

Most Chinese companies investing in the European Union will increase investments despite meeting some hurdles, said a survey released by the EU Chamber of Commerce in China yesterday.

Nearly 97 percent of respondents said they plan to make future additional investments in the EU, with 82 percent planning to invest higher amounts than their current investments, according to the survey on the Chinese Outbound Investment in the EU compiled jointly by the chamber, KPMG and Roland Berger Strategy Consultants.

But at the same time, 78 percent of respondents report they encounter operational difficulties, mostly related to issues of bureaucracy and high costs.

Chinese non-financial outbound investment surged 28.6 percent from a year earlier to US$77.2 billion last year, with 4,425 overseas companies operating in 141 countries and regions, the Ministry of Commerce said. The investment in the EU was not immediately available but the chamber said it was rising as the debt crisis made it less expensive.

"Greater Chinese investment in the EU is a positive trend and this survey clearly shows that Chinese companies face few regulatory market access barriers in Europe," said Davide Cucino, president of the European Chamber.

Thomas Rodemer, a partner of KPMG, said the survey results showed Chinese companies, primarily selling their goods and services in the EU, are confident about their future in Europe and intend to increase their presence.

Chinese companies operating in the EU are looking to further engage in mergers and acquisitions to obtain technology, brands and expertise, the survey said.

Also, the EU is perceived by Chinese investors as a stable environment with advanced technologies, skilled labor and a transparent legal environment.

The major barriers facing Chinese investors included the difficulties in getting work visas for Chinese employees, problems dealing with European labor laws, a lack of uniform legislation in the region of 27 member states and 23 official languages, the survey said.

China ranked as the world's sixth-biggest international investor last year. With rising desire to become a global player, Chinese investors have also met increasing cold shoulders.

One example was the still unsuccessful attempt to acquire a piece of land in Iceland by Huang Nubo, president of Beijing Zhongkun Investment Group, a property developer. State-owned enterprises like China National Offshore Oil Corp often find their investment plans halted due to their state-owned origins, and private firms like Huawei Technologies were also snubbed.

Robin Bew, chief economist and editorial director at Economist Intelligence Unit, said earlier Chinese investors should improve their overseas image and correct the impression that Chinese funds are more politically than commercially driven.