ANI
23 Sep 2022, 22:48 GMT+10
Beijing [China], September 23 (ANI): European corporate investment in China is slackening as the country's real estate market is slumping, consumer spending drying up because of stringent "Covid zero" policies, as well as American investment is also faltering because of geopolitical tensions.
The signs are ominous for the Chinese economy as foreign investments are limited to a handful of multinationals, reported The Straits Times.
China's published statistics for foreign direct investment show that it is gradually rising overall. But the bulk of what China counts as foreign investment is money arriving from Hong Kong, which tends to be composed of mainland money that has been briefly routed through Hong Kong as a tax-minimisation measure.
A new analysis by Rhodium, a New York research firm, shows that so-called greenfield investments from the European Union and Britain in new factories and other installations have plunged, reported The Straits Times.
These investments fell to just under USD 2 billion in the first half of this year, compared with USD 4.8 billion in the first half of last year, according to Rhodium.
A handful of German manufacturers, like Volkswagen, account for the bulk of the few European investments still being made in China. They raise money for these investments mostly by keeping in China the profits generated by their Chinese subsidiaries instead of sending money from their home country.
The European Chamber of Commerce in China said in another report, issued in Beijing on Wednesday morning, that European companies have been frustrated by the difficulty of getting executives and employees from abroad into China, which has tightly limited international travel to reduce the risk of coronavirus outbreaks, reported The Straits Times.
China's economy grew just 0.4 per cent from a year earlier in the second quarter, an anaemic rate that has made the Chinese market less attractive for foreign investment.
Joerg Wuttke, the chamber's president, said no new European company had entered the Chinese market since the start of the pandemic, and that all but the largest European companies were losing interest, reported The Straits Times.
"They don't even want to consider China," he said, adding that companies' preferences are "clearly South-east Asia, India and other parts of the world".
On Tuesday, the Swedish Chamber of Commerce in China released a survey of its members that also found many of them pessimistic about the investment climate in China.
In its report, the European chamber recommended a series of policies to China's government to revive foreign investment. These include making it easier for European airlines to fly to China and not fostering Chinese consumer boycotts of European goods over disputes like China's human rights policies, reported The Straits Times. (ANI)Get a daily dose of China National News news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to China National News.
More InformationLONDON, U.K.: Britons' outlook on the economy has hit an all-time low, with public confidence plunging to its weakest point since records...
BEIJING, China: China's Huawei Technologies is stepping up efforts to challenge U.S. dominance in artificial intelligence hardware,...
NEW YORK, New York - U.S. stocks forged higher and the U.S. dollar regained ground Thursday as investors shrugged off concerns about...
NEW YORK CITY, New York: Colgate-Palmolive posted stronger-than-expected quarterly results and raised its annual sales outlook last...
WASHINGTON, D.C.: President Donald Trump's administration warned over the weekend that it might limit livestock imports from Mexico...
SHANGHAI, China: Carmakers are stepping up their efforts to meet booming demand for long-range hybrids in China, the world's largest...
SYDNEY, Australia: Australia's ruling Labor Party says it will raise the fee for international student visas to A$2,000 (US$1,279)...
BEIJING, China: China's Huawei Technologies is stepping up efforts to challenge U.S. dominance in artificial intelligence hardware,...
SINGAPORE: Singapore has ordered Facebook's parent company, Meta, to block Singaporeans from seeing posts made by three foreigners...
SHANGHAI, China: Carmakers are stepping up their efforts to meet booming demand for long-range hybrids in China, the world's largest...
TOKYO, Japan: TikTok is preparing to expand its e-commerce business into Japan, aiming to launch TikTok Shop in the country within...
TOKYO, Japan: Toyota's overseas sales surged to a new March record, driven largely by a rush of North American buyers ahead of newly...