German firms less certain of meeting goals
Print Edition
GERMAN companies are less confident of meeting business targets in China where the economy is transiting to a slower growth, a survey showed yesterday.
Around 50.5 percent of German companies operating in China expect to achieve or exceed their business targets this year, down from 60.6 percent last year, according to the Business Confidence Survey 2015 released yesterday.
Only 27 percent of companies think the Chinese economy will improve, down sharply from 48.9 percent last year, the survey found, adding that the remainder expect a flat or worsening economy.
“The result doesn’t mean a downturn of German business in China but reflects that German companies are now adjusting to the new economic realities in China and focusing more on sustainable development,” Titus Freiherr von dem Bongart, chairman of the German Chamber of Commerce in Shanghai, said at a press conference yesterday.
The survey among 439 German companies was conducted by the German Chamber of Commerce in China between May 11 and June 12.
The survey found that 54.4 percent of automotive companies expect improvement in the industry outlook, followed by 37.5 percent among chemical firms and 36.5 percent in services.
The survey also found that the top business challenges include finding and retaining qualified staff, rising labor costs, currency risks, bureaucratic red tape, slow Internet speed, Internet censorship, domestic protectionism, unclear regulatory framework and intellectual property theft.
Air pollution, slow Internet speed and Internet curbs are perceived as the top-three factors having a negative impact on the investment climate in China, the survey found.
Modern manufacturing is the most attractive sector for German companies, with 65 percent of them considering new production in the automotive, machinery and chemical sectors, the survey showed.
The chamber estimates there are around 5,200 German companies operating in China in 2015, up from 5,000 last year, and accounted for 1.1 million jobs in the country.
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