China remains a key market for European companies as its economic resilience and large domestic market are vital for them to stay globally competitive, according to a survey by the China Council for the Promotion of International Trade (CCPIT). About 19% of European companies said that they have expanded their production and business scale in China, while 65% said that they have maintained their current operational scale, the study said. Nearly 160 European companies were interviewed for the survey on their business outlook, investment climate and market conditions in the first half of 2022.
The vast majority of European multinationals are confident in the prospects of the Chinese market, said Sun Xiao, Spokesman for the Beijing-based CCPIT. For instance, European aircraft manufacturer Airbus launched a new research center in Suzhou, Jiangsu province, in June, to focus on research for its futuristic hydrogen-powered aircraft. German chemical group BASF gave the green light for the construction of a planned chemical production project in Zhanjiang, Guangdong province, in July. In addition to implementing a new negative list for foreign investment to further broaden market access, the government abolished, revised or enacted 520 regulations to improve the legal environment for foreign investment. The government also ramped up efforts to ensure the legitimate rights and interests of foreign businesses, the Ministry of Commerce said. China’s advantages, including a complete industrial system, a lucrative market, social stability, and positive long-term economic fundamentals, as well as the smooth operation of China-Europe freight train services, have created a solid foundation for the growth of European companies, said Sang Baichuan, Dean of the Institute of International Economy at the University of International Business and Economics in Beijing.
“In the context of market demand, supply chain stability, global companies’ existing footprint, current growth in China or their future development strategy, China-EU or China-U.S. decoupling is not realistic. Any such course would likely harm either side,” he said. Trade between China and the European Union grew by 8.9% on a yearly basis to CNY3.23 trillion in the first seven months of 2022, the China Daily reports.
