Image credit: Carl Court/Getty Images

February 28, 2019

The EU Needs a Better Way to Screen Chinese Investment. It Should Look to France.

By Ashley Feng and Sagatom Saha

From the United States to Australia, countries are tightening restrictions on investment in strategic sectors like energy and defense, with a wary eye toward China. There are mounting concerns globally about the pitfalls associated with Chinese investment and whether it is a Trojan horse for Beijing to gain access to critical technologies, data and infrastructure that it can use for its own military ends. Europe is not immune to these concerns, and late last year, the European Union passed an investment screening mechanism of its own that specifically targeted China. Yet the EU will still have to do more to tackle forced technology transfers, both lawful and illicit, and other issues. Fortunately, it can look to one of its own members for a scalable solution: France, which has adopted a smart approach to foreign investment, adding scrutiny while staying open for business.

Chinese investments across Europe are substantial, totaling $33.7 billion in 2017. Of China’s top 20 foreign investment destinations in 2017, five were EU countries. While this investment has helped to offset other economic woes on the continent, it has come with legitimate concerns. Even though the EU collectively represents the world’s largest economy, it has received little reciprocity from Beijing. EU companies entering the Chinese market are often forced to share their intellectual property and are restricted to investments in limited sectors, while Chinese companies enter the European market with no similar restrictions.

Read the full article in World Politics Review.

  • Commentary
    • Sharper
    • August 9, 2023
    Sharper: Economic Statecraft

    As competition between the United States and China escalates, and the war in Ukraine continues, countries have embraced new forms of economic statecraft to accomplish key fore...

    By Anna Pederson & Charles Horn

  • Congressional Testimony
    • April 13, 2023
    The Role of Investment Security in Addressing China’s Pursuit of Defense Technologies

    Summary of Testimony Chairman Bartholomew, Vice Chairman Wong, and Commissioners, thank you for the opportunity to provide testimony before the Commission.1 A summary of the r...

    By Emily Kilcrease

  • Commentary
    • October 19, 2022
    Sharper: The State of AI

    The U.S. government's recent chip export controls are the latest salvo in the U.S.–China rivalry in artificial intelligence. Semiconductors are a key input for AI systems and ...

    By Anna Pederson

  • Commentary
    • The Atlantic Council
    • September 14, 2022
    Sand in the silicon: Designing an outbound investment controls mechanism

    Recent congressional efforts to establish new authorities to regulate outbound investment have revived a long-simmering debate in Washington about the economic and security ri...

    By Emily Kilcrease & Sarah Bauerle Danzman

View All Reports View All Articles & Multimedia