At the World Economic Forum in Davos Emmanuel Macron urged Europe to attract more direct investment from China to spur growth and secure technology transfers, arguing that trade alone is not enough to rebalance relations. He framed the appeal around mutual benefit while warning that “large-scale overcapacity and distortive practices” from abroad could unsettle European industry and must be addressed through new cooperative models.
The French president’s call came the same day the European Commission unveiled a draft revision to the EU’s cybersecurity law that would bar equipment from suppliers based in so‑called “high‑risk” countries from 18 critical sectors, including high‑speed telecommunications. Although the proposal does not name any country, its predecessors and media coverage make clear it is aimed at Chinese players such as Huawei and ZTE, reviving an axis of industrial policy and security concern that has been building since the 5G debates of 2020.
Beijing responded by stressing long‑standing themes: Chinese products, it said, gain competitiveness through investment in research, strong market competition and integrated supply chains rather than subsidies, and Chinese firms are willing to invest abroad on market principles. The foreign ministry urged the EU to provide a fair, non‑discriminatory, transparent and predictable environment for Chinese investors — a demand that highlights the asymmetry between rhetoric and practice in the current European approach.
European media and some policymakers cast China at Davos as a defender of multilateralism at a time when protectionist rhetoric has reappeared in the United States, suggesting an opening for Europe. Yet analysts inside China and Europe note a tension: calls for Chinese capital sit beside policy frameworks explicitly designed to “de‑risk” and limit exposure to foreign suppliers deemed problematic, creating a conditional welcome that may deter inward investment.
Industry reaction was swift. Huawei criticised any law that differentiates suppliers by country of origin rather than by technical evidence and standards, warning that such measures contravene EU principles of proportionality and non‑discrimination and could prompt legal pushback. European officials argue they are not singling out specific countries but say governments must be able to shield critical infrastructure from geopolitical interference.
Scholars in China caution that Europe’s mix of invitation and restriction will cap the potential for Chinese investment unless Brussels adopts clearer, reciprocity‑oriented rules rather than broad “security first” frameworks. They warn that a continued tilt toward de‑risking and selective decoupling risks long‑term damage to bilateral trade and investment ties, pushing both sides into more entrenched economic separation.
The episode underscores a wider strategic dilemma for Europe: how to reconcile economic openness with political and technological sovereignty. The balance struck in the coming months — whether through clearer, rule‑based screening that is genuinely non‑discriminatory or through more expansive exclusions of Chinese firms — will shape investment patterns, supply‑chain choices and the future of EU‑China relations.