Chinese Direct Investment in the Baltic Sea Region: Some Recommendations for Policymakers

Chinese outward foreign direct investment (OFDI) only started to increase significantly in the Baltic Sea Region (BSR) after the outbreak of the 2008 Great Financial Crisis. Chinese OFDI (COFDI) in the BSR has been heavily concentrated in Germany and Russia with a very strong focus on the energy and technology sectors. This mirrors what we have seen elsewhere: Chinese companies have been investing overseas to obtain natural resources, intellectual property and process knowledge, and leading consumer and manufacturing brands in order to improve their competitive position at home, facilitate greater sales abroad, and help China satiate its economic development and national security objectives. Growing COFDI in the BSR raises a number of potential political and economic consequences that warrant thoughtful consideration by regional policymakers. This report gives background on COFDI and COFDI in the BSR, discusses some of the concerns associated with COFDI, and offers a number of policy recommendations.

This report is part of the BSR Policy Briefing Series (January 2018) and appears in full on the Centrum Balticum website at: http://www.centrumbalticum.org/en/news_room/publications/bsr_policy_brie.... It is posted with the express permission of Centrum Balticum.