Overview of China outbound investment in Q1 2019
Beijing, 6 May 2019
This news release has been issued by Ernst & Young, China, a part of the global EY organization.
EY released the Overview of China’s Outbound Investment in Q1 2019, according to which, China’s non-financial ODI in Q1 2019 amounted to US$25.2 billion, down 1.1% YOY, and non-financial ODI in B&R countries totaled US$3.8 billion, up 4.2% YOY, higher than China’s overall growth rate1.The announced value of China’s overseas M&As declined in Q1 2019 and was the lowest over a recent five-year period, decreasing by nearly 50% YOY. The most attractive M&A destinations to Chinese enterprises shifted to Asia and Oceania from Europe and North America. The value of announced M&A deals to Oceania increased significantly by over 80%. Sector concentration of China’s overseas M&As continued to increase. In terms of deal value, the M&A activities were led by TMT, life sciences and mining and metals, all of which representing nearly 70% of total deal value, while TMT remained the top sector by number of deals2. According to Loletta Chow, Global Leader of China Overseas Investment Network at EY, China’s overseas M&As declined significantly because ”in Q1 2019, Chinese enterprises generally took a more prudent approach to overseas M&As to avoid risks amid intense global trade relations, increasingly complicated geopolitics, and the slowdown in major economies. With slipping investment confidence in Europe and North America where foreign investment policies were tightened and uncertainty increased, many Chinese enterprises turned to Asia. Meanwhile, with economic transformation and upgrade, sectors such as TMT, life sciences and consumer products were expected to attract more capital. We recommend that investors plan prudently and be prepared to address challenges and optimize cross-border M&As in an increasingly regulated global environment.”China’s overseas EPC projects continued to increase steadily in Q1 2019. The total value of new contracts grew by 13.5% YOY to US$50.6 billion, and new EPC contracts signed in B&R countries increased significantly by 47.7%.3
2019年中国第一季度对外投资综述
2019年5月6日，北京
这份新闻稿由中国安永会计师事务所发布，是全球安永组织的一部分。
安永发布了《2019年中国第一季度对外投资概览》，其中，在2019年第一季度，中国非金融对外直接投资总额为252亿美元，同比下降1.1%；对一带一路沿线国家的非金融对外直接投资总额为38亿美元，同比上升4.2%，高于中国整体增长率。2019年第一季度公布的中国海外并购交易额下降，为近五年来最低，同比下降近50%。对中国企业来说，最具吸引力的并购目的地从欧洲和北美洲转移到了亚洲和大洋洲。并购交易给大洋洲带来的价值显著增加，增长了80%以上。中国海外并购的行业集中度持续上升。就交易价值而言，并购活动由科技、媒体和通信、生命科学、矿业和金属主导，所有这些占交易总价值的近70%，而科技、媒体和通信仍是交易数量最多的行业。安永中国海外投资网全球负责人罗莉塔周(Loletta Chow)表示，中国的海外并购大幅下降，因为在2019年第一季度，总体来说，中国企业对海外并购采取更谨慎的方式，以避免因全球贸易关系紧张、地缘政治日益复杂以及主要经济体放缓而带来的风险。由于欧洲和北美采取紧缩的外资政策，增加了不确定性，中国企业对欧洲和北美投资信心下滑，许多中国企业转向亚洲。与此同时，随着经济转型和升级像科技、媒体和通信、生命科学和消费品这些行业有望吸引更多资本。我们建议投资者谨慎规划，并做好准备，在监管日益规范的全球环境中应对挑战，优化跨境并购。2019年第一季度，中国海外工程总承包项目继续稳步增长。新合同总值同比增长13.5%，达到506亿美元，一带一路沿线国家签署的新工程总承包合同大幅增长47.7%。
The structure of China’s ODI became optimized and diversified, while B&R cooperation advanced steadily
中国对外直接投资结构优化多元化，一带一路合作稳步推进
The beginning of 2019 saw steady, healthy and orderly cooperation and development in China’s ODI. According to the Ministry of Commerce (MOFCOM), China’s non-financial ODI reached US$25.2 billion in Q1 2019, down 1.1% YOY. Investment increased significantly in sectors including leasing and commercial services, manufacturing, wholesale and retail as well as information transfer/software and IT services, accounting for 27.4％, 21%, 9.1％ and 8.8%, respectively. It reflected that the structure of ODI was optimized continuously, and further control over “irrational” investment was implemented effectively. There was no new overseas investment in real estate, sports and entertainment sectors.
Moreover, the B&R construction continues to move forward steadily. In Q1 2019, China’s non-financial ODI in B&R countries amounted to US$3.8 billion, up 4.2% YOY, higher than China’s overall growth rate, and accounting for 15% of the total value.
2019年初，中国对外直接投资稳步、健康、合作发展有序推进。商务部称，2019年第一季度中国非金融对外直接投资达到252亿美元，同比下降1.1%。租赁和商业服务、制造、批发和零售以及信息传输/软件和信息技术服务等部门的投资显著增加，分别占27.4%、21%、9.1%和8.8%。这反映出对外直接投资结构不断优化，对“非理性”投资的进一步控制得到有效实施。房地产、体育和娱乐行业没有新的海外投资。
此外，一带一路建设继续稳步推进。2019年第一季度，中国对一带一路沿线国家国家的非金融对外直接投资达到38亿美元，同比增长4.2%，高于中国整体增长率，占总价值的15%。
Announced overseas M&A value and deals both decreased, as Chinese enterprises tended to be more cautious
宣布的海外并购价值和交易都有所下降，因为中国企业变得更加谨慎
In Q1 2019, 121 overseas M&A deals were announced by Chinese enterprises, decreased by 42.9% YOY, with a total value of US$10.8 billion, decreasing by 49.5% YOY.
2019年第一季度，中国企业公布了121笔海外并购交易，同比下降42.9%，总值108亿美元，同比下降49.5%。
Sector analysis:
Driven by the transformation and upgrade of China’s economy, China’s overseas M&As increased in the emerging sectors with high technology and high added-value. By value, China’s overseas M&As were led by TMT (US$3.7 billion, or 33.9%), life sciences (US$1.9 billion, or 17.6%) and mining and metals (US$1.8 billion, or 16.7%) in Q1 2019, accounting for approximately 70% of the total value. Mining and metals, power and utilities and life sciences achieved YOY increase while other sectors declined
By number of deals, TMT (35), consumer products (22) and life sciences (11) were the top sectors for Chinese investors, accounting for approximately 60%
部门分析:
在中国经济转型升级的推动下，中国海外并购在高技术、高附加值的新兴行业有所增加。按价值计算，2019年第一季度中国的海外并购主要由科技、媒体和通信(37亿美元，即33.9%)、生命科学(19亿美元，即17.6%)和采矿和金属(18亿美元，即16.7%)主导，约占总价值的70%。采矿和金属、电力和公用事业以及生命科学实现了同比增长，而其他行业出现下滑。
从交易数量来看，科技、媒体和通信(35)、消费品(22)和生命科学(11)是中国投资者的首选行业，约占60%。
Geographical analysis:
The most attractive M&A destinations to Chinese enterprises shifted to Asia and Oceania from Europe and North America. Driven by the BRI and the improved relationship between China and Australia, Chinese enterprises are expected to continue to increase investment in Asia-Pacific
Despite the cautious overseas M&A activities in general, the announced M&As value by Chinese enterprises still increased dramatically in Oceania (up 81.8%), Africa (up 192.8%) and South America (up 165.2%). The key sectors were life science and consumer products in Oceania, power and utilities in South America, and mining and metals in Africa
Affected by Brexit and the newly released European Union (EU) framework for the screening of foreign direct investments (FDIs) (was officially effective in April 2019), Chinese enterprises further reduced their M&A activities in Europe. In Q1 2019, the announced M&A deal value in Europe was decreased by nearly 90% YOY. Chinese enterprises’ investment in Europe is expected to gradually resume with the mitigation of Brexit-related uncertainties and the clarification of procedures of the new EU framework for the screening of FDIs
地理分析:
对中国企业最有吸引力的并购目的地从欧洲和北美转移到亚洲和大洋洲。在一带一路倡议和中澳关系改善的推动下，中国企业预计将继续增加在亚太地区的投资。
尽管总体上对海外并购活动采取谨慎态度，但中国企业宣布的并购价值在大洋洲(上升81.8%)、非洲(上升192.8%)和南美洲(上升165.2%)仍大幅上升。关键部门是大洋洲的生命科学和消费品、南美洲的电力和公用事业以及非洲的采矿和金属。
受英国脱欧和新发布的欧盟外国直接投资筛选框架(2019年4月正式生效)的影响，中国企业进一步减少了在欧洲的并购活动。在2019年的第一季度，官方宣布的并购交易在欧洲的价值同比下降了近90%。随着与英国脱欧相关的不确定性的缓解和欧盟新的外国直接投资筛选框架程序的澄清，中国企业在欧洲的投资预计将逐步恢复。
Large overseas EPC projects become a key driver for local development
大型海外工程总承包项目成为当地发展的关键驱动力
According to the MOFCOM, China’s overseas EPC projects increased steadily in Q1 2019. The value of new contracts signed by Chinese enterprises reached US$50.6 billion, up 13.5% YOY. The value of new EPC contracts signed in B&R countries increased significantly by 47.7%, accounting for 60.2% of the total value and increased 13.9 percentage points YOY. Most overseas EPC projects were large projects and have become a key driver for local development. In Q1 2019, the number of overseas EPC projects that valued over US$50 million reached 177, increased 19 projects YOY, accounting for 83.2% of the total value of newly signed projects.
商务部称，2019年中国第一季度的海外工程总承包项目稳步增长。中国企业签订的新合同价值达到506亿美元，同比增长13.5%。与一带一路沿线国家签署的新工程总承包合同价值大幅增长47.7%，占总价值的60.2%，同比增长13.9个百分点。大多数海外工程总承包项目都是大型项目，已经成为当地发展的关键驱动力。2019年第一季度，价值超过5000万美元的海外工程总承包项目达到177个，同比增加19个项目，占新签约项目总价值的83.2%。
1 Source: MOFCOM
2 Source: Source: ThomsonOne, Mergermarket, including overseas M&As of Hong Kong, Macau and Taiwan and deals have been announced but not yet completed; EY analysis
3 Source: MOFCOM
1资料来源:商务部
2来源:来源:托马斯·索诺(ThomsonOne)，合并市场，包括香港、澳门和台湾的海外并购，交易已经宣布但尚未完成；安永分析
3资料来源:商务部
来源: (https://www.ey.com/cn/en/newsroom/news-releases/news-2019-ey-overview-of-china-outbound-investment-in-q1)
