From openness to increasing protectionism: the factors influencing the EU’s changing approach to Chinese direct investment in the European market
From openness to increasing protectionism: the factors influencing the EU’s changing approach to Chinese direct investment in the European market

Summary/Abstract: The aim of this article is to explain the factors underlying the European Union’s changing approach to Chinese direct investment in the European market between 2000 and 2024. The research hypothesis assumes that the EU’s shift from openness to increasing protectionism in response to Chinese direct investment is driven by fears surrounding the possible negative effects of excessive Chinese political influence and dependence on China, which are perceived as threats to the EU’s security and competitiveness. The research was conducted using a descriptive method based on the analysis and critique of scientific literature, documents, legal acts, reports and statistical data. The analysis demonstrated that during the study period (2000–2024) the value of capital in the form of foreign direct investment (FDI) from Chinese companies in the European market increased, despite significant changes in the annual inflows of these investments and their structure. This trend resulted from several factors, one of the most important being the EU’s change in approach to incoming foreign direct investment from China. It began to be perceived as a threat to European industry and national security. Concerns about the possible negative effects of excessive Chinese political influence on the European economy, coupled with dependence on China, meant that the EU’s initial openness to Chinese direct investment gave way to increasing protectionism. The various institutional and legal instruments introduced to protect the Single European Market will increase in line with the EU’s efforts to strengthen its strategic independence, security, resilience, and competitiveness. It is important to strike the right balance when using market protection instruments. If they are too restrictive, they could result in an outflow of foreign capital (including Chinese capital) from the European economy, which would not be in the EU’s interest.Keywords: foreign direct investment (FDI), protectionism, European Union, China.

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