Chinese investors favor Europe, survey finds

A growing number of Chinese investors are likely to shift to Europe with the United States triggering trade tensions with China, a key survey has found. According to Invest Europe's Global Investment Decision Makers Survey 2018, a clear majority of investors (82 percent) — especially those in China (97 percent) — state that a stable regulatory environment is important when making investment decisions, with 47 percent of investors rating Europe as a top performer on regulatory climate compared with the US (32 percent).

The survey findings, released on Monday, also cited that around two in five investors from China (38 percent) said their view of Europe had improved because of a decline in the US attractiveness, more than the 25 percent of respondents overall said the same.

Generally, the survey found that Europe's attractiveness as an investment destination was on the rise compared to 2017, as the majority of global investors are more likely to invest in both the EU and the United Kingdom after Brexit.

Nearly 90 percent of investors said Europe had become a more attractive investment destination over the last five years. Invest Europe will present the findings at a high-level European Commission conference on Monday. Following last year's inaugural survey, global investors still rank Europe above China and the US for its highly skilled workforce, transport infrastructure and regulatory climate.

They now perceive Europe to have moved ahead of the US as the leader on innovation and entrepreneurship, taxation levels and access to global markets. However, Europe lags the US on IT infrastructure and level of economic growth.

Almost eight out of 10 investors (78 percent) expect increased investment in Europe over the next five years, as they become more positive on investing in both the EU and the UK after Brexit.

"Global investors are increasingly looking towards Europe," said Michael Collins, CEO of Invest Europe.

"The continent is now outshining China and the US in many areas, from its skilled workforce to its open markets and thriving innovation. While Europe isn't immune to the political and social strain being felt around the world, if policymakers focus on

regulatory stability, investment in innovation and better capital markets integration, Europe can be on top in the years to come."

However, investor confidence in Europe's political stability fell from 50 percent to 40 percent year-on-year, while social stability dropped from 50 percent to 39 percent. Europe's perceived commitment to sustainability and the environment — an important issue for 80 percent of investors — has also declined, from 74 percent to 50 percent.

Invest Europe is an association representing European private equity and venture capital, and their global investors. It commissioned ComRes, an independent research consultancy, to survey 360 investment decision makers at companies from the US, China, Germany, the UK and France in October 2018.