While European companies say the direct impact of the US-China tariff war on their Chinese operations has been relatively limited, they are less confident about the short-term business outlook, according to a survey conducted by the European Union Chamber of Commerce in China.
Advertisement
European companies were better prepared for the current trade war than the first round in 2018, and had been able to mitigate the direct impact of increased tariffs, chamber president Jens Eskelund said.
However, the trade war had significantly affected business confidence, with 59 per cent of survey respondents saying that doing business had become more difficult this year.
There was also pessimism about the outlook for the next two years, with 64 per cent of respondents expecting intensified competition and 58 per cent expressing concerns about future profitability.
The survey of 162 chamber members found they were most affected by China’s tariffs on American goods, with almost half of respondents saying they were a problem.
Advertisement
Chinese tariffs were affecting commodities that were critical to manufacturing and that could be painful for companies, Eskelund said.
By contrast, over two-thirds of respondents said they had not been affected by United States tariffs on imports from China, which could be attributed to the “‘in China, for China” approach many companies had adopted, the survey found.
