Last month Wen Jiabao, China's premier, announced that Beijing would use its foreign exchange reserves to support and accelerate overseas expansion and acquisitions by Chinese companies. This “going out” strategy will benefit Europe and should be welcomed. Estimated at more than $2,000bn (€1,400bn, ￡1,200bn), the Chinese reserves are the largest in the world. Like all foreign investment, Chinese capital will bring employment, tax revenue and reciprocal market access. More generally, a welcoming stance could in the long run stimulate investing companies to adopt – to some degree – standards of corporate governance and social responsibility that are compatible with Europe's economic interests.

To say that foreign investment from China is welcome, however, is not to argue that governments should just sit back and enjoy the benefits. On occasion, it can be at odds with the national interests of the host country. To maintain oversight, therefore, a case-by-case review system should be in place. Such a system would also help address unwarranted public anxiety about investment from countries whose political and economic systems differ from our own. This would in turn facilitate the continued growth of investment from emerging economies such as China, which is still small compared with the high level of bilateral trade already in place.

What has already caused anxiety in some European countries, particularly Germany and France, is the fact that the leading Chinese companies, banks and investment funds are state-controlled. Because Europeans regard China's autocratic political system as incompatible with their own democratic norms, the growth of Chinese influence in European companies is a highly sensitive issue.