IDEAS home Printed from https://ideas.repec.org/a/wsi/ceprxx/v01y2012i01ns1793969012500069.html
   My bibliography  Save this article

Chinese Odi In France: Motives, Strategies, And Implications

Author

Listed:
  • FRANÇOISE NICOLAS

    (Center for Asian Studies, French Institute of International Relations, 27 rue de la Procession, 75740 Paris Cedex 15, France;
    Paris-Est University, 5 Boulevard Descartes, Champs-sur-Marne, 77454 Marne-la-Vallée Cedex 2, France)

Abstract

Although outward direct investment (ODI) is still very much a developed country phenomenon (with industrial countries accounting for more than 75% of global flows), ODI from the "South" is gaining ground, with China ranking among the most active outward investors, together with, but well ahead of, India and Brazil. Today, although the bulk of Chinese investment abroad is still directed to neighboring Asian economies and to natural resource–rich African countries, a sizeable share of these outward investments is targeted at industrial economies, namely the US and the EU, raising concerns of a "Chinese challenge." Taking France as a case study, the paper seeks to determine whether these concerns are well or ill founded and the implications of this new state of play. The paper starts with an overview of Chinese ODI in France, with regards to function, sector, and mode of entry in particular. As a next step, it examines in detail the push and pull factors influencing Chinese investors' activities and assesses their performances as well as the possible impacts of their presence for the host as well as for the home economy. The paper shows that the concerns expressed about the presence of Chinese investors are wholly misplaced so far for a number of reasons. First, Chinese ODI is still extremely limited; second, Chinese investors can be shown to behave exactly like any other foreign investors, with market-seeking objectives prevailing over strategic asset-seeking motivations. Third, Chinese ODI may lead to win-win situations. In particular, French firms can be shown to be in a position to benefit from Chinese ODI either by discharging underperforming assets or by getting an access to the Chinese market. Finally, the paper examines France's alleged underperformance in terms of attractiveness to Chinese investors. It suggests that the apparent "French exception" should not be exaggerated and that it can be easily explained. However, country-specific characteristics may contribute to deter Chinese investors and need to be taken into account. In terms of policy recommendations, preserving the country's openness to foreign investment should stay on top of the priority list.

Suggested Citation

  • Françoise Nicolas, 2012. "Chinese Odi In France: Motives, Strategies, And Implications," China Economic Policy Review (CEPR), World Scientific Publishing Co. Pte. Ltd., vol. 1(01), pages 1-30.
    • Handle: RePEc:wsi:ceprxx:v:01:y:2012:i:01:n:s1793969012500069
    DOI: 10.1142/S1793969012500069
    as

    Download full text from publisher

    File URL: http://www.worldscientific.com/doi/abs/10.1142/S1793969012500069
    Download Restriction: Access to full text is restricted to subscribers
    File URL: https://libkey.io/10.1142/S1793969012500069?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Françoise Hay & Christian Milelli & Yunnan Shi, 2008. "Présence et stratégies des firmes chinoises et indiennes en Europe. Une perspective dynamique et comparative," Post-Print halshs-00423565, HAL.
    2. Margot Schüller & Anke Turner, 2005. "Global Ambitions: Chinese Companies Spread Their Wings," Journal of Current Chinese Affairs - China aktuell, Institute of Asian Studies, GIGA German Institute of Global and Area Studies, Hamburg, vol. 34(4), pages 3-14.
    3. Huang,Yasheng, 2008. "Capitalism with Chinese Characteristics," Cambridge Books, Cambridge University Press, number 9780521898102.
    4. Daniel H. Rosen & Thilo Hanemann, 2009. "China's Changing Outbound Foreign Direct Investment Profile: Drivers and Policy Implications," Policy Briefs PB09-14, Peterson Institute for International Economics.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Cheng Chen & Wei Tian & Miaojie Yu, 2019. "Outward FDI and Domestic Input Distortions: Evidence from Chinese Firms," The Economic Journal, Royal Economic Society, vol. 129(624), pages 3025-3057.
    2. William T. Allen & Han Shen, 2011. "Assessing China's Top-Down Securities Markets," NBER Working Papers 16713, National Bureau of Economic Research, Inc.
    3. Guo Chen & Amy K Glasmeier & Min Zhang & Yang Shao, 2016. "Urbanization and Income Inequality in Post-Reform China: A Causal Analysis Based on Time Series Data," PLOS ONE, Public Library of Science, vol. 11(7), pages 1-16, July.
    4. Alessia Amighini & Claudio Cozza & Roberta Rabellotti & Marco Sanfilippo, 2014. "Investigating Chinese Outward Foreign Direct Investments: How Can Firm-level Data Help?," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 22(6), pages 44-63, November.
    5. Li, Jiaming & Li, Yuheng & Zhang, Wenzhong & Yu, Jianhui, 2018. "Imbalanced ownership transformation and land use within an urban area: a case study of Beijing," Land Use Policy, Elsevier, vol. 74(C), pages 240-247.
    6. Hao Liang & Bing Ren & Haikun Zhu, 2011. "Revisiting the OLI Paradigm: The Institutions, the State, and China's OFDI," CESifo Working Paper Series 3642, CESifo.
    7. Bastian Gawellek & Jingjing Lyu & Bernd Süssmuth, 2016. "Did Chinese Outward Activity Attenuate or Aggravate the Great Recession in Developing Countries?," CESifo Working Paper Series 5735, CESifo.
    8. Yitian Ren, 2023. "Rural China Staggering towards the Digital Era: Evolution and Restructuring," Land, MDPI, vol. 12(7), pages 1-25, July.
    9. Zhan, Shaohua, 2015. "From Privatization to Deindustrialization: Implications of Chinese Rural Industry and the Ownership Debate Revisited," World Development, Elsevier, vol. 74(C), pages 108-122.
    10. Mi Lin & Yum K. Kwan, 2017. "FDI Spatial Spillovers in China," The World Economy, Wiley Blackwell, vol. 40(8), pages 1514-1530, August.
    11. Xiwei Zhu & Ye Liu & Ming He & Deming Luo & Yiyun Wu, 2019. "Entrepreneurship and industrial clusters: evidence from China industrial census," Small Business Economics, Springer, vol. 52(3), pages 595-616, March.
    12. Christopher Marquis & Cuili Qian, 2014. "Corporate Social Responsibility Reporting in China: Symbol or Substance?," Organization Science, INFORMS, vol. 25(1), pages 127-148, February.
    13. van der Kamp, Denise & Lorentzen, Peter & Mattingly, Daniel, 2017. "Racing to the Bottom or to the Top? Decentralization, Revenue Pressures, and Governance Reform in China," World Development, Elsevier, vol. 95(C), pages 164-176.
    14. Le, Vo Phuong Mai & Matthews, Kent & Meenagh, David & Minford, Patrick & Xiao, Zhiguo, 2021. "Shadow banks, banking policies and China’s macroeconomic fluctuations," Journal of International Money and Finance, Elsevier, vol. 116(C).
    15. Julie Ann Elston & Alois Weidinger, 2019. "Entrepreneurial intention and regional internationalization in China," Small Business Economics, Springer, vol. 53(4), pages 1001-1015, December.
    16. Prasad, Eswar, 2014. "Global Implications of the Renminbi’s Ascendance," ADBI Working Papers 469, Asian Development Bank Institute.
    17. Jesús Fernández-Villaverde & Lee Ohanian, 2010. "The Spanish Crisis from a Global Perspective," Working Papers 2010-03, FEDEA.
    18. Xiaohua Yang & Clyde D. Stoltenberg, 2013. "Chinese multinationals and the state: an institutional perspective," Chapters, in: John Farrar & David G. Mayes (ed.), Globalisation, the Global Financial Crisis and the State, chapter 4, pages 72-93, Edward Elgar Publishing.
    19. Yao, Shujie & Wang, Pan, 2014. "Has China displaced the outward investments of OECD countries?," China Economic Review, Elsevier, vol. 28(C), pages 55-71.
    20. Kellee Tsai, 2015. "The Political Economy of State Capitalism and Shadow Banking in China," HKUST IEMS Working Paper Series 2015-25, HKUST Institute for Emerging Market Studies, revised May 2015.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wsi:ceprxx:v:01:y:2012:i:01:n:s1793969012500069. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Tai Tone Lim (email available below). General contact details of provider: http://www.worldscinet.com/cepr/cepr.shtml .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.