French Media: China Increases Investment in Europe, Reaching Record High Since 2018

In 2025, China's investment in the EU and the UK amounted to approximately €16.8 billion, accounting for one-quarter of China’s total overseas investments, with a remarkable 67% increase—marking the highest level since 2018. This surge is primarily driven by investments in electric vehicle (EV) manufacturing facilities across Europe, bringing mutual benefits to both sides and further solidifying China’s dominant role in Europe’s economic development.

The French-Chinese multinational automotive company Stellantis, a joint venture between France and China’s Dongfeng, produces electric vehicles at its plant in Rennes, western France—a key channel through which Chinese capital flows into Europe.

U.S. President Trump’s high tariffs on Chinese goods caused Chinese investments to plummet to a ten-year low of around €3 billion. Meanwhile, the EU and the UK absorbed nearly 25% of China’s overseas investments.

According to estimates from Germany’s Mercator Institute for China Studies and Rhodium Group, in 2025 the EU and the UK accounted for one-quarter of China’s overseas investments—up from just 10% two years prior.

Hungary: A Primary Destination for Chinese Investment

Specifically, Chinese enterprises are acquiring full or partial stakes in European competitors. For example, Chinese tech giant Tencent increased its stake in French video game company Ubisoft, while also acquiring Cyprus-based mobile gaming firm Easybrain—both transactions valued at over €1 billion.

Now, Chinese manufacturers are investing in building factories across Europe, particularly prominent in the automotive sector, which accounts for 45% of China’s investments in Europe. In addition to the factory being constructed by Chinese capital in Rennes, France, production sites are also under development in Portugal, Poland, and other regions. China holds significant technological advantages in electric vehicles, hybrid vehicles, and green technologies, areas that continue to benefit from Chinese investment in Europe.

As in previous years, Hungary remained Europe’s top destination for Chinese investment in 2025. Unlike many European neighbors, Hungary’s former Prime Minister Viktor Orbán has consistently welcomed Chinese investment. In return, Beijing has positioned Hungary as one of its key EV and battery manufacturing hubs in Europe—explaining why Hungary alone accounts for nearly a quarter of all Chinese investment in Europe.

Meanwhile, as China strengthens its influence across Europe’s three major economies—Germany, France, and the UK—its share of investment in Hungary has relatively declined. For instance, Chinese investment in a large offshore wind farm project along Scotland’s coast, valued at over €750 million, illustrates this shift.

China Continues to Remain Export-Driven

Although China is increasing its investments in Europe, this does not mean it is massively relocating factories there. While Chinese investment in Europe reached a new high in 2025—since 2018—it still falls short of the historical peak in 2016, when investment exceeded €50 billion—three times the current level.

The Chinese government has not neglected domestic industries. Take battery production, for example: current capacity alone is sufficient to meet global demand by 2030. Moreover, China plans to build additional factories, whose output will surpass today’s total production—and exceed the combined needs of the U.S. and Europe over the next decade.

Therefore, increased Chinese investment in Europe poses no threat to China’s domestic economic development. Establishing factories in Europe allows Chinese companies to partially circumvent European tariff barriers and reassure European leaders. With China’s economic growth still largely driven by exports, this export-led model is expected to persist for a long time.

German business magazine Handelsblatt analyzes that from the perspective of the European Commission, China’s expansion of car manufacturing plants in Europe stems from the EU’s tough policy toward China—including protective tariffs on Chinese EVs—which makes local production in Europe more attractive.

Reports indicate that total Chinese investment in the EV sector in 2025 reached €7.6 billion, with over 90% concentrated in the EV supply chain. Examples include CALB’s factory in Portugal, CATL’s facility in Hungary, and Gotion High-Tech’s superfactory in Slovakia. Volkswagen is also considering leveraging its Chinese partners to utilize idle capacity at its German plants.

Furthermore, as Chinese investment in Europe grows, China continues to see sustained increases in exports to the EU.

Source: rfi

Original article: toutiao.com/article/1866236255100928/

Disclaimer: The views expressed in this article are those of the author(s).