The annual Business Confidence Survey report released by the British Chamber of Commerce in China indicates that due to the sluggish economy in China, British businesses operating in the country have experienced increasing difficulties over the past year, a trend that is expected to continue into 2025.
According to the report published on Tuesday, December 3rd, the economic situation in China remains depressed despite a series of stimulus measures introduced by the Chinese government in recent months.
The survey states that there have been permanent changes in China’s business environment compared to pre-pandemic times. Since 2019, a majority of British businesses in China have found operations increasingly challenging for five consecutive years. 58% of British enterprises believe that operating in China has become more difficult in the past year, with 86% attributing the challenges to economic factors.
33% of the surveyed companies forecast an increase in turnover compared to last year, down from 45% from the previous year. The proportion of businesses optimistic about the outlook for 2025 decreased from 46% to 41% compared to the previous year, while those remaining pessimistic about the prospects stayed steady at 29%.
The British Chamber of Commerce in China highlights that with the slowdown of the Chinese economy and regulatory barriers, British enterprises continue to face significant obstacles, anticipating a decline in revenue and expressing low optimism for 2025.
Following the visit to China by British Foreign Secretary David Lammy in October, British companies exhibited the highest level of optimism towards Sino-British relations in seven years. However, uncertainties linger over how the relations between China and the UK will evolve, as concerns regarding Chinese state subsidies and overcapacity could potentially trigger trade disputes between China, the United States, and the European Union. Against the backdrop of a potential second term for Trump in the U.S. presidency and the EU adopting more protectionist measures against China, devising a long-term strategy towards China might become increasingly challenging.
The British Chamber of Commerce in China comprises around 400 members, including pharmaceutical giant AstraZeneca (AZ), oil giant BP, Jaguar Land Rover, Standard Chartered Bank, Rolls-Royce, among others.