Is There Discord Between China and EU Business Relations?

There is trouble brewing in the China and EU business relationship. Beijing claims that it will welcome foreign investors in the country. However, investors are not buying this argument. Though most European firms operating in the world’s second largest economy have marked sales increase, they look deeply frustrated with China. The biggest Asian economy is now making a shift to consumer-driven growth but it will not be possible without foreign firms entering the market. The intricate complexities of the Chinese market and the government regulations do not sit well with foreign firms.

China and EU

Let’s Be Honest, China is Difficult

 

A recent survey by the European Union Chamber of Commerce in China shows that business confidence is far from the China rhetoric. This annual survey has brought forward sour results in the past as well, showing China has failed to deliver on promises. Many European firms still find it very difficult to do business in China. Moreover, the foreign firms are treated unfairly in the country. On Wednesday, a lobby group claimed that China only claims to welcome foreign investment but only works on rhetoric.

The Asian economy has been under severe pressure to make its market more accessible to foreign firms. Chinese stocks have been down.  Chinese exports have infiltrated the world market but the Chinese economy remains relatively closed to the outsiders. Other economies want a level playing field in the past as well. On Thursday, China and EU will meet in Brussels to talk about bilateral investments. Trade in Chinese territories will be a priority in these talks.

China’s Rhetoric- Real or Fake News?

 

Recently, China has had a paradigm shift in its trade outlook. The country has been trying to denounce its trade protectionism. Chinese leaders now talk about bringing free trade to their country and inviting foreign firms to do so. It even went head to head with the US, with Trump’s protectionism and America First agenda on the line. However, the business confidence surveys reveal otherwise. It is still very complicated and difficult to do business in China. The country has also bred a hostile environment which is biased for domestic businesses.

In the survey, foreign companies complained that they had to face more stringent regulations as compared to their domestic counterparts. There has also not been an increase in market accessibility for these firms. As China tries to transform its economy, will it be possible for foreign firms to survive in hostile lands? The country needs more policy level changes to bring business confidence to its territory.