Spain is now the seventh-most attractive country in Europe for Chinese investment, with more than €1.7 billion of Chinese money pouring into the Spanish economy in 2016, reveals data by investment firm Baker McKenzie…
China, the world’s second-largest economy after the USA, has been active in a number of strong Western economies for some time, and is also a big investor in African infrastructure.
Chinese money flowing to Spain in 2016 tended to go into the infrastructure, entertainment and real estate industries – with the Dalian Wanda group heavily involved in the latter as China snaps up Spanish commercial and residential property opportunities.
Other areas where China’s financial clout has been keenly felt have been in sport (toy car magnate Chen Yansheng last year paid €200 million to purchase La Liga football club RCD Espanyol), the environment and aviation.
“Chinese investors are attracted to European countries in several sectors such as the food industry, because that gives them access to the supply chains,” said Baker McKenzie partner Maite Díez. “The goal is to offer high-quality products in China, where there is growing demand.”
Spanish produce popular in China includes wine, olive oil and cheese, while Spanish fashion and film is also starting to make an impact in the country. Tourism, meanwhile, is proving a huge draw for the Chinese – many Spanish cities are now hot destinations for China’s growing middle class, and while they still tend to steer clear of Spain’s beach resorts, many inland areas of beauty are also starting to turn heads.
Since the recent recession, a growing number of European countries have become much cheaper for Chinese people to visit and invest in, and that in turn has created growing demand. Where once a typical Chinese tourist wanted nothing more than a selfie in front of London’s Big Ben, today’s tourist is just as likely to head to Spanish wine country, or France’s Provence, analysts believe.
Chinese firms, meanwhile, have been swift to build real estate portfolios in Spain, including not only residential properties but also hotel chains, movie theatres and shopping malls, Baker McKenzie added.
The UK, Germany, Finland and Switzerland still attract the bulk of Chinese investment in Europe, but Spain’s rise was the sharpest last year.