According to the British Chamber of Commerce in China, 60% of British businesses believe that a slowing Chinese economy will pose a greater obstacle to their operations in the massive Asian nation than the severe COVID restrictions that were in place until late last year.
The chamber's annual sentiment survey, which was released on Tuesday, revealed that while the "peak pessimism" that was recorded during the pandemic is easing, British businesses are delaying new investment in China amid a sluggish economic recovery and are downgrading the importance of the world's second-largest economy to their global operations.
Due to a number of factors, including a less robust than anticipated post-pandemic recovery, a string of office raids by Chinese authorities, financially strapped local governments providing fewer investment incentives, and higher investment yields in the United States, foreign investors have been wary of China for the most of this year.
"In previous years, 80% (of firms) were investing more because of market potential, but it feels like we're now entering a phase of real clarity," Julian Fisher, the chamber's chair said.
"(Firms) are a lot more pragmatic and there's a lot less speculation," he added.
BP, Shell, Jaguar Land Rover, and AstraZeneca are a few of the chamber's members.
Based on opinions expressed by members between October and November, the chamber's research showed that 60% of businesses believed that doing business in China had grown more challenging over the previous year, with 78% of these businesses attributing the increase to economic considerations.
"(British) companies in China are effectively treading water, with many delaying key decisions around investment and market entry," the report read.
In addition, over half of the enterprises surveyed claimed that geopolitics made it more difficult for their businesses to operate in China, and 43% of them reported having trouble with regulatory matters like obtaining licences.
Since the nation lifted its stringent COVID-19 restrictions late last year, foreign direct investment into China has significantly decreased. As a result, the nation recorded its first-ever quarterly deficit in foreign direct investment from July to September, indicating pressure from capital outflows.
Although "British businesses are experiencing a slow return in optimism," the chamber said that a trend of companies downsizing the significance of China in their global operations "appears to be stabilising."
Only 40% of the corporations questioned indicated that China was a "high priority," with just under half listing it as a "medium priority" or "low priority." By contrast, 59% of businesses considered China to be a "high priority" for 2021–2022.
China is now the fourth-largest economic partner of the UK, with trade between the two countries valued at 111 billion pounds ($140 billion) last year, according to the British National Bureau of Statistics.
(Source:www.moneycontrol.com)
The chamber's annual sentiment survey, which was released on Tuesday, revealed that while the "peak pessimism" that was recorded during the pandemic is easing, British businesses are delaying new investment in China amid a sluggish economic recovery and are downgrading the importance of the world's second-largest economy to their global operations.
Due to a number of factors, including a less robust than anticipated post-pandemic recovery, a string of office raids by Chinese authorities, financially strapped local governments providing fewer investment incentives, and higher investment yields in the United States, foreign investors have been wary of China for the most of this year.
"In previous years, 80% (of firms) were investing more because of market potential, but it feels like we're now entering a phase of real clarity," Julian Fisher, the chamber's chair said.
"(Firms) are a lot more pragmatic and there's a lot less speculation," he added.
BP, Shell, Jaguar Land Rover, and AstraZeneca are a few of the chamber's members.
Based on opinions expressed by members between October and November, the chamber's research showed that 60% of businesses believed that doing business in China had grown more challenging over the previous year, with 78% of these businesses attributing the increase to economic considerations.
"(British) companies in China are effectively treading water, with many delaying key decisions around investment and market entry," the report read.
In addition, over half of the enterprises surveyed claimed that geopolitics made it more difficult for their businesses to operate in China, and 43% of them reported having trouble with regulatory matters like obtaining licences.
Since the nation lifted its stringent COVID-19 restrictions late last year, foreign direct investment into China has significantly decreased. As a result, the nation recorded its first-ever quarterly deficit in foreign direct investment from July to September, indicating pressure from capital outflows.
Although "British businesses are experiencing a slow return in optimism," the chamber said that a trend of companies downsizing the significance of China in their global operations "appears to be stabilising."
Only 40% of the corporations questioned indicated that China was a "high priority," with just under half listing it as a "medium priority" or "low priority." By contrast, 59% of businesses considered China to be a "high priority" for 2021–2022.
China is now the fourth-largest economic partner of the UK, with trade between the two countries valued at 111 billion pounds ($140 billion) last year, according to the British National Bureau of Statistics.
(Source:www.moneycontrol.com)
