In 2021, France beat its 2019 record for inbound foreign investment (in number of transactions and related employment).
In the context of the Covid-19 health crisis, many States have reinforced their foreign investment control mechanisms, fearing the loss of industrial and R&D capacities in the health sector. In the long term, governments intend to protect numerous areas of activity (energy, agri-food, new technologies, to mention only the most publicized).
It is to be expected, therefore, that States will, if they have not already done so, apply strictly their regulations on foreign investments in order to protect their national interests. This is what the European Commission has encouraged Member States to do in March 2020.
The European Union (EU) also has mechanisms for cooperation between the European Commission and Member States (stemming from a March 2019 Regulation), which must now exchange information on planned or received foreign investments. This gives the EU the possibility, outside of existing national regulations (if any), to screen these investments.
Staying open and attractive while protecting national interests is the challenge facing States as foreign investment will play a key role in the coming years in recovering from the economic crisis created by Covid-19, and aggravated more recently by the war in Ukraine.