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From France to Poland to the UK, check out how governments are strengthening screening rules on assets deemed essential for security and public order in light of covid-19.
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The proposed regulations are not final but even without revisions, they are likely to significantly impact foreign investment in the country’s infrastructure, Kirkland’s Mario Mancuso, Shawn Cooley & Luci Hague explain.
Outside renewables, Chinese investors acquired no Australian infrastructure in 2018, the only deal being a buyout of engineering firm RCR Tomlinson’s rail arm.
Panellists debated whether foreign investment in infrastructure posed credible security risks or whether governments were exaggerating the threats.
Peter Costello said partnerships with local investors, but also greater transparency on the part of sovereign funds is the way forward.
Treasurer Josh Frydenberg confirmed his ‘final decision’ that the takeover would be ‘contrary to the national interest’.
Australia deciding to block a Chinese purchase of a national asset is not new – but its decision to block CK Infrastructure’s bid for APA Group feels different.
While stricter regulations surrounding foreign investment in infrastructure have coincided with a rise in populism around the world, we find the root causes lie elsewhere.
Private equity managers and their LPs could stand to lose from government intervention on foreign direct investment.
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