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2007-11-22 | All chapters

European Union Chamber of Commerce in China launches its fourth annual Business Confidence Survey

Beijing, 22nd November 2007. The European Union Chamber of Commerce in China today launched its annual European Chamber Business Confidence Survey, which is published in partnership with Roland Berger Strategy Consultants. The survey presents the opinions of more than 200 European companies operating in China.
 
Joerg Wuttke, the President of the European Chamber, commented, “EU companies are doing well in an increasingly competitive business environment. In comparison to last year’s survey, there is a stronger focus both on establishing R&D facilities, and also on expanding investment. Furthermore, European business has achieved this in a regulatory environment that has not improved. EU companies could serve their Chinese customers even better, if there was more transparency and the Chinese government would implement its regulations.”

The survey reveals that European businesses are generally optimistic about their business performance in China. Their optimism is mostly based on the continuing strength of China’s economic development and the resulting growth in domestic consumption. However, many of them are concerned about a series of issues such as shortages of qualified staff, environmental problems, and insufficient protection of Intellectual Property Rights. European business expects the Chinese government to take more effective action to address these problems.
 
Charles-Edouard Bouee, the Managing Director of Roland Berger Strategy Consultants in Greater China, pointed out: "The optimism on business performance is not surprising. To a great extent, it reflects the experience of our European clients operating in China, who are confident to remain profitable in the coming years."

Michael O'Sullivan, the Secretary General of the European Chamber, said of the survey, “It provides an important insight into the concerns and views of European businesses operating in China, and this year it bears out many of the concerns which we raised in our annual Position Paper in September. We think it will be of interest to governments in both China and Europe”.
 
The European Chamber Business Confidence Survey 2007 will be presented to government and regulatory agencies in China, to the European Commission and EU Member State Governments, as well as to a wide range of business organisations and companies in China and Europe.

To download this press release, please click here: English version, 中文新闻稿

To download the PowerPoint presentation on the press conference, please click here:
English version, 发布会上中文幻灯片

To download the photos of the press conference, please click here:
photo1发布会上照片1，photo2发布会上照片2

To view the press reports about the survey, please click here 媒体剪报.

For further information, please contact:
Grace Yao, Press Officer of the European Chamber
Phone: +86 10 6462 2066 – 30; E-mail: gyao@euccc.com.cn

Key findings of the European Chamber Business Confidence Survey 2007

Facts and trends

More than 80 percent of the respondents indicated they were primarily in China to access or serve the Chinese market. 69 percent of the respondents plan to increase their investments in China within the next two years. This is combined with a willingness to invest in R&D centres in China. The number of Wholly Foreign Owned Entities (WFOEs) is rising. They are EU companies preferred means of operating in China.  76 percent of the respondents are either making a profit or at least breaking even, while 82 percent of the unprofitable companies expect to make a profit within 3 years.  There is a trend for companies to shift their sales and service centres, from 1st tier to 2nd and 3rd tier cities.  73 percent of the respondents are optimistic about future growth opportunities.  Challenges and concerns Recruiting and retaining qualified staff remains a challenge.  Labour costs are expected to increase by more than 10 percent annually.  Localisation of top management is not progressing as quickly as expected. More than 50 percent of European businesses are sceptical about the implementation of WTO obligations. IPR protection, lack of transparency and inconsistencies in government regulations are still the main barriers to further investment in China.