Chinese companies are likely to slow their cross-border shopping spree in 2017 as the central government clamps down on leverage and overseas governments raise concerns over foreign investments, ratings agency Standard and Poor's said in a report released on Tuesday.
"We anticipate that Chinese overseas buyers will face tougher regulatory and political hurdles this year and that some high-profile international deals will come under increased scrutiny. Countries such as the U.S. are also likely to favor tougher policies," S&P analysts wrote.
In 2016, the value of Chinese cross-border mergers and acquisitions hit $36 billion in the U.S. and $72 billion in Europe—up from $5 billion and $13 billion respectively in 2015 as the by the government encouraged technology acquisition and expansion into new markets.
While the Chinese government is still supportive of M&A to help industries make more sophisticated products, it has implemented steps in the last few months to control currency depreciation and limit debt levels of state-owned enterprises.