‘This year has been difficult for the majority of German companies,’ said Clas Neumann, chair of the German Chamber of Commerce’s east China chapter.
German companies’ confidence in China has hit an all-time low, the German Chamber of Commerce in China said on Dec. 4, citing its newly published survey.
Germany is China’s biggest European trading partner, and trade tensions between China and the EU have
tightened as the EU tries to hold China to international standards.
“This year has been difficult for the majority of German companies, prompting a downward adjustment of their business outlook,” said Clas Neumann, chair of the German Chamber of Commerce’s east China chapter.
Half of German companies surveyed said conditions in their industry had worsened this year, with only a third saying they predict improvement next year. Still, 92 percent of German companies planned to maintain their operations in the $19 trillion Chinese economy, Neumann said.
The British Chamber of Commerce in China ran a similar survey, reporting on Dec. 3 that confidence is low, with 41 percent expecting improvement next year.
“British businesses continue to face significant headwinds, from China’s economic slowdown to regulatory hurdles,” said the chamber, which represents some 400 companies including Rolls-Royce, AstraZeneca, and Standard Chartered. “Revenue expectations are down, and businesses’ optimism for 2025 is low despite the announcement of stimulus measures.”
China is currently experiencing an economic
downturn, and international analysts are watching for details of stimulus measures from the Chinese regime, which have so far
fallen short of expectations.
China’s economy took a steep dive during the COVID-19 pandemic due to the communist regime’s draconian lockdown measures. The severe environment also triggered foreign capital
outflows from China, and foreign investment in China has continued to
trend downward. China’s
real estate sector, which propped up the nation’s GDP, is also in
freefall, prompting the regime to shovel
funds into softening the industry’s collapse.
“The Chinese economy is not seeking growth anymore; it’s seeking survival,” Mike Sun, a U.S.-based businessman with decades of experience advising foreign investors and traders in China, previously told The Epoch Times.
Financial advisers and
global banks have noted that the measures that the regime has taken so far have not
boosted domestic demand. Some advisers, like Sun, additionally warn that the Chinese regime has a history of falsifying or publishing only limited numbers, and real problems could be far worse.
The low domestic demand accounts for the lowered sales to European businesses in China.
It also contributes to China’s oversupply problem, which is a primary cause of trade tensions with the European Union.
In October, the European Union hiked
tariffs on Chinese electric vehicles (EVs) only after a year-long
investigation that concluded that the Chinese regime had subsidized the sector to the point of oversupply and that Chinese manufacturers were dumping the products on the European market at injurious prices.
Chinese regime spokespersons signaled retaliation, and soon after, Beijing announced tariffs on European food imports and
challenged the EV tariff by lodging a formal complaint with the World Trade Organization (WTO). The European Union has maintained that the Chinese tariffs and
investigations on European food products do not
meet the
standards that China agreed to when it joined the WTO.
The EU has also targeted Chinese imports separately based on
forced labor used by the Chinese regime and unfair trade
practices.
Terry Wu and Reuters contributed to this report.
