European companies must look east for growth as domestic markets face mounting pressure, argues Frank Tang, chief executive of FountainVest Partners. Speaking at Davos, Tang said Asia offers both massive demand and innovation, with China playing a central role despite recent economic headwinds. He noted global investor sentiment toward China has improved after a period of being seen as 'uninvestable.'

Tang acknowledged China's biggest risk is weak domestic consumption, citing job creation struggles and property sector stress. Yet the sheer scale of its market continues to anchor long-term investment opportunities. Innovation, particularly in life sciences where Chinese firms produce globally competitive products, remains a key driver. He also expressed optimism about Hong Kong's capital markets, citing a strong IPO pipeline for private equity exits.

The comments reflect how Asia-focused buyout firms are positioning as partners for European companies seeking growth beyond saturated home markets. For investors, this underscores a strategic pivot: European firms may need Asian partnerships to sustain profitability. The next phase involves monitoring which sectors—like life sciences—see the most cross-border deal flow and how Hong Kong's IPO revival supports private equity exit strategies.