China is a significant player in Spain, serving as its second largest supplier of goods and twelfth largest customer for exports. However, the reverse is not as true. Spain ranks only eighth in terms of Chinese investments in Europe, with a modest presence of Chinese companies in the country until 2010. It was only from 2013 onwards that major Chinese companies began to see opportunities in the Iberian Peninsula. Despite the cautious approach, Chinese investment in Spain had reached 11.347 billion euros by 2022, a fraction of the value of a company like Iberdrola in the stock market. The country offers ample opportunities in areas such as infrastructure, renewable energy, tourism, manufacturing, and automotive industries, attracting Chinese investors with its market size, geographical location, labor costs, and commitment to sustainable energy.
Since 2012, the majority of Chinese investments in Spain have focused on sectors like energy, real estate, and building services, with notable acquisitions including Madrileña Red de Gas, the Edificio España in Madrid, and NH Hoteles. While football teams like RCD Español and Atlético de Madrid have secured sponsorship deals with Chinese companies, recent years have seen an increase in both the quality and quantity of Chinese investments in Spain. During a recent official visit to China by Spanish President Pedro Sánchez, the Chinese battery manufacturer Envision committed to investing over 900 million euros to establish a factory for electrolyzers in Spain, adding to their existing projects in the country. The renewable energy sector has been particularly attractive to major Chinese groups like China Three Gorges, which have made significant investments in solar and wind power projects in Spain.
Spain has actively encouraged Chinese investment in the renewable energy sector, showcasing its commitment to green energy and industrial development. The country has also expressed interest in attracting Chinese electric vehicle manufacturers to establish a presence in Spain, leveraging its position as the second largest producer of combustion engine automobiles in Europe. Efforts are underway to establish joint ventures with Chinese companies for the production of electric vehicles and components in Spanish plants, representing a potential boost to the local automotive industry and economy. Spain faces competition from other European countries like Hungary and the Czech Republic in attracting Chinese investments, highlighting the need for sustained efforts to enhance its industrial base.
Despite challenges such as ongoing trade disputes and economic uncertainties in China, the wave of Chinese investments in Spain continues to grow. Chinese companies are increasingly engaging in diverse sectors such as wind power, textiles, industrial self-consumption, and solar parks in Spain. As the proverb says, “The best time to plant a tree was 20 years ago. The second best time is now.” The influx of Chinese investments poses both opportunities and challenges for Spain, requiring careful navigation of economic, innovation, and resource management considerations. The evolving relationship between the EU, its member states, and China underscores the need for strategic approaches to balance economic benefits with potential risks associated with increased Chinese presence in Spain’s market and industry.
As Spain navigates the complexities of attracting Chinese investments while safeguarding its own economic interests, the growing presence of Chinese companies in the country signals a paradigm shift in global investment dynamics. The symbiotic relationship between Spain and China reflects a new era of economic collaboration and competition, reshaping traditional market landscapes and opening doors to innovative partnerships. While the road ahead may present challenges and uncertainties, the momentum of Chinese investments in Spain underscores the transformative impact of strategic economic diplomacy and cross-border cooperation, shaping the future of both nations’ economic landscapes.
