In China, business sentiment plunges to ‘all-time low’, EU Chamber of Commerce finds
- Annual Business Confidence Survey of European firms operating in China paints a bleak economic outlook with never-before-seen levels of pessimism ‘setting a negative cycle in motion’
- Findings suggest China is ‘no longer the obvious choice for all’, while regions such as Southeast Asia and India increasingly become more appealing
Pessimism on the investment outlook in China is weighing heavier on European companies amid economic uncertainties and geopolitical tensions, a leading foreign business association has warned as it renewed calls for Beijing to take concrete steps to restore business confidence.
European firms have become more hesitant to broaden their investments in China and continue to eye possibilities in other regions such as Southeast Asia and India, the European Union Chamber of Commerce in China said on Friday.
Among respondents to its annual Business Confidence Survey, 15 per cent – a record-low proportion of companies in the poll – said China was still their top investment destination, while only 13 per cent – another historic low – still viewed it as the top destination for the future.
Another 13 per cent, the highest share ever recorded in the survey, said they were not planning to further invest in China.
Despite three-quarters of respondents saying they planned to reinvest some of their 2023 profits in China, more than a third said they would reinvest less than their historical average.
Companies are beginning to realise that some pressures seen in the global market … have really taken on a more permanent danger
China is “no longer the obvious choice for all”, said the annual report, which cited responses from 529 member companies in January and February.
