European companies cut investments in China
according to webangah News Agency, an annual survey published on Wednesday shows European firms are reducing expenditures and retreating from investment initiatives in China. this shift comes amid slowing economic growth in China and intense market competition causing price collapses.
The challenges facing these companies reflect broader issues in China’s economy, which has been disrupted by a prolonged real estate crisis leading to reduced consumer spending. together,Beijing faces growing pressure from Europe and the U.S. opposing its export surge.
The European Union Chamber of Commerce in China stated in its “Business Confidence survey 2025” report: “Conditions have deteriorated across many key indicators.”
Forces driving China’s export growth have simultaneously darkened business prospects in its domestic market.Chinese companies-often bolstered by government subsidies-have overinvested in targeted industries like electric vehicles, creating production capacity far exceeding demand.
This oversupply has triggered severe price wars,shrinking profit margins and pushing firms toward foreign markets.
In Europe, concerns are mounting that surging Chinese imports could weaken domestic manufacturers and employment. the EU imposed tariffs on Chinese electric vehicle imports last year, alleging unfair state support for producers.
Jens Eskelund, President of the EU Chamber of Commerce in China, recently told reporters: “There appears to be a perception that benefits from bilateral trade and investment relations aren’t being distributed fairly.”
While praising China’s efforts to boost consumer spending, Eskelund stressed the government must ensure supply growth doesn’t outpace demand. Survey results indicate downward pressure on profitability intensified throughout last year, wiht business confidence yet to hit bottom.
The report surveyed approximately 500 member companies between mid-January and mid-February.Eskelund added: “With profit margins declining, conditions have become genuinely arduous for everyone.”
