German media: Chinese enterprises' investment in Europe may hit the bottom and rebound

According to the report on the website of the Frankfurt Report of Alemania on February 21, Chinese investors have significantly reduced their corporate acquisitions in Europe. According to a study by Ernst&Young, an audit and corporate consulting company, last year, Chinese investors made 139 acquisitions or shares across Europe, 16 fewer than in 2021.

The report said that the estimated value of the 139 transactions was only $4.3 billion, a decrease of nearly two thirds compared with the previous year. However, Ernst&Young pointed out that most of the above-mentioned acquisitions did not disclose the price.

According to the report, compared with the record 2016, this decline will be particularly obvious. At that time, Ernst&Young recorded 309 corporate acquisitions or equity investments by Chinese investors in Europe, totaling $86 billion. Since then, this number has continued to decline. At present, Chinese investors' corporate acquisitions in Germany are also rare. According to Ernst&Young, last year, China had only 26 acquisitions or shares in German enterprises, with a value of less than $290 million. Ernst&Young speculated that Chinese investors were avoiding large-scale acquisitions with political controversy.

Ernst&Young said that in addition to the political obstacles and tensions between China and the West, restrictions on the COVID-19 epidemic also had an impact. Sun Yi, partner of Ernst&Young Greater China Strategy Consulting, said that travel restrictions and isolation regulations increased the difficulty of the transaction.

Sun Yi estimated that more Chinese enterprises will seek acquisition targets in Europe again this year.

It is reported that at present, daily life in many parts of China has returned to normal, and foreign companies have also returned to optimism. The German Federation of Overseas Chambers of Commerce said that many companies expected their business in China to develop actively, especially from the second or third quarter. Therefore, investment should pick up again.

China's economy has shown signs of stabilization recently. The industrial atmosphere has improved significantly. The International Monetary Fund raised China's economic growth forecast this year from 4.4% to 5.2%.

At the same time, Chinese enterprises have begun to explore overseas again. Since the beginning of the year, many Chinese business delegations have visited Germany and other European countries.

Yulia Kleckner, a politician of the German Christian Democratic Union, told Deutsche Presse-Agentur that China and the EU, especially Germany, have close economic partnership, which has brought prosperity to both sides in the past decades.