Foreign direct investments (FDI) consist in real investments to from one country to another that are directly linked to economic activities. In the era of globalization, FDI have become a major economic driver of economic growth. FDI are not only capital investment but also a major source of technology transfer across economies. This work investigates the cause and consequence of FDI on EU economies, focusing on FDI from China. The FDI determinants are tested to study their impacts towards inward FDI of 28 EU countries. FDI determinant refer to the socio-economic factors of the host country that are relevant to the decision making of FDI investors. In terms of consequence of FDI, this work tests the impact of FDI to economic growth of EU countries. Six FDI determinants are selected in the research: market size, market growth, openness, macroeconomic stability, corruption and political stability. Four economic growth factors are studied in this research: FDI, openness, domestic investment and government expenditure. Annual data of 28 EU countries in the observation from 2002 to 2013 are used. Research hypotheses are established and multiple linear regression is the major tool of data analysis and hypothesis testing. The empirical results show that at country level, market size, openness and political stability are the most significant factors that influence incoming FDI. These three factors have positive relationships with FDI inflow of a EU country, yet market growth macroeconomic stability and corruption are found not to have any significant impact on investment decisions. On MB149023 Leong Carla A study on European country’s FDI: its impact to economy and host factors to attract FDI from China v economic growth, the regression model is specified according to economic growth theory that FDI, openness, domestic investment and government expenditure are included as independent variables. The empirical result supports our research hypotheses that FDI inflow have a positive impact on a country’s economic growth. Implications of the research result on FDI and government policies are also discussed.