Doing business in China is getting harder: European chamber survey

Firms curb investments but some are buying more Chinese components on broad price falls

- Keith Bradsher

BEIJING - European companies, many of which have operated in China for decades, are finding it increasingly difficult to do business in the country, another sign of how China's weak domestic economy and opaque regulations are testing even longstanding multinational business ties.

European carmakers have been rapidly losing market share and face many political difficulties. Volkswagen (VW) agreed last December to sell its factory in northwestern China's Xinjiang region. European pharmaceutical and medical imaging equipment companies have found themselves locked out of much of the state-run health system.

An extensive annual survey of businesses released on May 28 by the European Chamber of Commerce in China found that nearly three-quarters said it was getting harder to operate in China. It was the fourth consecutive year that the survey showed deepening corporate pessimism.

The proportion of European companies that plan to expand their operations in China has also fallen to a record low, with just 38 per cent saying that they intend to do so in 2025.

European investment has been important in bringing Western technology to China and in bringing Chinese products to world markets.