European companies say that network regulation, regulatory barriers and market access restrictions are hindering their development prospects in mainland China.
According to the annual survey of the European Chamber of Commerce in China, nearly half (48%) of European companies have felt that it has become more difficult to do business in China in the past year.
Mats Harborn, chairman of the European Union Chamber of Commerce in China, said: 'In the long run, it is time for China to unload its auxiliary wheels to create a sustainable economy. This year, we saw some improvements in areas such as law enforcement, but we are leaving An environment that promotes fair competition is still far away.'
46% of respondents believe that market access restrictions and regulatory barriers have caused their business plans to be defeated. The same proportion of respondents believe that in the next five years, regulatory barriers will increase.
Last year, President Xi Jinping proposed reforms and increased market opening in the World Economic Forum in Davos, Switzerland. However, the survey of the European Union Chamber of Commerce in China showed that the change was very slow in the eyes of the respondents. Only 6% of the companies surveyed Seeing that market openness has expanded since 2016. 19% of respondents said they were forced to transfer technology to China in exchange for market access.
The survey shows that China's vigorously promoted China's manufacturing industry policy such as 2025 favors the development of local Chinese enterprises. 43% of the respondents said that foreign companies suffered unequal treatment. 29% of the respondents said that they heard that only Chinese companies can Obtain subsidies and focus on the environment and renewable energy.
Two-thirds of European companies believe that China's 'One Belt, One Road' initiative has little to do with their business, although aerospace and civil engineering and construction companies are optimistic about opportunities from huge international infrastructure.
More than half of the respondents (51%) believe that foreign companies are treated less than domestic companies, a slight decrease compared to last year, but there is a wide gap between industries. Although only 32% of chemical/oil companies feel Domestic companies are treated preferentially, but 67% of medical device companies believe they are unfairly treated.
A quarter of European companies believe that they will never see an environment where all companies can compete fairly.
Since the beginning of the investigations in February and March, Sino-US trade negotiations have broken down, and both countries have vowed to carry the tariff threats to the end.
Enhance innovation
According to this year's survey report, most of the respondents (61%) said for the first time that Chinese local companies have the ability to innovate with European companies. The respondents said that although Chinese companies are constantly responding to innovation through products and services. Rising consumer demand, but they are still lagging behind in more challenging forms of innovation, such as scientific research and engineering.
The respondents are optimistic about the current situation of intellectual property protection, but believe that the road ahead still has a long way to go. This year, 34% of the respondents believe that IP enforcement is in place or excellent, which is a significant improvement from 13% five years ago. However, 29% of the companies surveyed said that they suffered a major loss due to intellectual property infringement.
Since last year, 15 IP courts have been established nationwide, but European companies are still dissatisfied with the time of acceptance.
The proportion of respondents who set up R&D centers in China remains unchanged at 44%. One of the reasons cited in the survey report is that many European companies are reluctant to bring core technologies to China because they fear being infringed.
Three-fifths of the companies surveyed have confidence in the growth prospects for the next two years, the highest since 2014. 66% of respondents said that sales in mainland China increased by 5% or more than in 2017. More, this is the biggest increase since 2012.
However, the respondents were slightly less optimistic about the yield. 46% of the respondents indicated that they plan to cut costs this year, reaching a record high.
Internet access is another major concern, with 64% of respondents saying that network restrictions have had a negative impact on their business.
The rapid aging of the Chinese population has spurred the sale of medical equipment and pharmaceuticals. The automotive and chemical/oil industries have also seen double-digit growth. Information technology companies reported that their revenues have fallen by more than 10% because of the new cybersecurity The Law requires information technology products and services to be 'safe and credible'.
The survey shows that as China focuses on high-end manufacturing, low-cost manufacturing is accelerating the transfer to Southeast Asian countries.
Small and medium-sized enterprises said that the SME Promotion Law, which favors local businesses, has caused them to suffer a cold shoulder. European companies believe that large state-owned enterprises with more than 1,000 employees are more innovative than small and medium-sized enterprises.
Respondents' views on environmental law enforcement have improved significantly. 45% of respondents highly value the government's environmental protection measures and doubled year-on-year. However, two-thirds of respondents believe that compared with local companies The government has stricter enforcement of environmental protection for foreign-funded enterprises.
Although the companies surveyed noticed that the enforcement of environmental regulations has gradually increased, there are still some people complaining that severe supervision has a negative impact on foreign-invested companies, even those that are law-abiding. Some of them are considering some of them. Business transfer to foreign countries.
As far as the overall business environment is concerned, the respondents are most worried that the Chinese economy may slow down, and secondly, they are worried about the fuzzy rules and regulations and the global economic slowdown.
The online survey was organized by the Munich consulting firm Roland Berger. 1195 EU Chamber of Commerce members were invited to participate in the survey, 532 of which completed the questionnaire survey, the questionnaire recovery rate was 44.5%.
Since 2004, the European Union Chamber of Commerce in China has conducted a questionnaire survey of its members every year.