US EditionEuropean companies cut costs, scale back investments in China as its economy slows
- In a 2025 survey released Wednesday, European firms indicated they are reducing expenses and postponing expansion efforts in China due to the country’s economic slowdown.
- The economic slowdown follows an extended downturn in the real estate sector, which has weakened consumer expenditure and intensified market competition, notably impacting industries such as electric vehicles.
- The European business community in China has pointed to excessive production capacity, intense price competition eroding profits, and increasing opposition from Europe and the US in response to the surge in Chinese exports.
- Jens Eskelund, chamber president, remarked that businesses are currently facing significant challenges due to shrinking profit margins and added that overall business confidence has not yet reached its lowest point.
- These challenges have led to record low optimism and investment plans, suggesting a cautious outlook for European businesses in China despite Beijing's efforts to boost consumer demand.
32 Articles
32 Articles
European Companies Scale Back Investments in China as Its Economy Slows | Business Matters (May 28)
European companies are cutting costs and scaling back investment plans in China as its economy slows and fierce competition drives down prices, according to an annual survey released Wednesday. Their challenges reflect broader ones faced by a Chinese economy hobbled by a prolonged real estate crisis that has hurt consumer spending. ...
Western companies are investing less in China, which is already grappling with a real-estate crisis and growing pushback over surging exports
Chinese companies, often enticed by government subsidies, have invested so much in targeted industries that factory capacity far outpaces demand.
European firms counter China challenges by deepening local supply chain investments
The European Union Chamber of Commerce in China, in partnership with consultancy Roland Berger, released its Business Confidence Survey 2025 on Wednesday, revealing that while European companies report more operational challenges in China, many are simultaneously deepening their local supply chain investments.
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