A recent report shows that the current favorable environment for overseas mergers and acquisitions features five trends, including weak global economic recovery, a new industrial revolution and the rise of China's domestic and multilateral companies.

The report, titled "China Overseas Investment Environment Report (2015-2016)," was jointly published on Sunday by the China Overseas Political and Economic Research Center and the Center for Regional Security Studies under the Chinese Academy of Social Sciences.

According to the Ministry of Commerce, in 2014, the number of Chinese overseas M&A projects reached 595, adding up to 56.9 billion USD, among which direct investment totaled 32.48 billion, accounting for 26.4 percent of China's overseas investment in 2014. Overseas financing reached 24.42 billion USD, accounting for 42.92 percent of total M&A, the report says.

"The weak global economic recovery has created unprecedented opportunities for overseas M&A," stated Yang Liqiang, professor at the University of International Business and Economics and the lead writer of the report. A significant number of small and medium enterprises in Europe and the U.S. need capital injection. They have taken measures such as privatization of state-owned enterprises and asset restructuring to attract foreign capital in order to reduce unemployment and bolster economic development. These relatively loose policies provide opportunities for Chinese firms. 

Meanwhile, traditional industries are in urgent need of restructuring, thanks to the impact of a new industrial revolution. Chinese enterprises can build their own industrial chains and supply chains through overseas M&A, and lay a foundation for embracing the fourth industrial revolution.

Rising Chinese multilateral companies will also greatly promote overseas M&A, Yang thinks. 

In addition, the One Belt, One Road initiative has boosted the collaboration of domestic and international economies, along with international cooperation. This will create new opportunities for Chinese firms' overseas M&A, particularly in Central, Eastern and Southern Europe, as well as Southeast and South Asia.

As for the overall environment of overseas M&A, the report says market access witnessed a slight improvement and the future market will become more open, but we should not rule out the possibility of individual countries increasing restrictions for a special period.