Many European companies are reviewing their investments in China “huge uncertaintylinked to zero Covid policy restrictions, according to a study published Monday. China is the last major economy to maintain a strict health strategy in the form of coronavirus. quarantine for people who test positive, targeted incarceration, or generalized և mandatory PCR tests.
But this policy has serious consequences for the economy, as many businesses are closed, tourism is in the hemisphere, factories are idle, and production chains are very broken. As a result, anti-Covid-19 measures were still the main obstacle for European companies doing business in China in 2021, according to an annual survey by the European Union (EU) Chamber of Commerce in China.
For the second year in a row, this reason tops the list of concerns. Thus, for 60% of the surveyed companies, it is even more difficult to do business in China than in 2020, the first year of the epidemic, which paralyzed the Asian giant’s economy. The survey was conducted among 600 companies in February-March. The period during which the Russian invasion of Ukraine and the capture of Shanghai began, two events that further punished the world trade.
The aftermath of the blockade և war in Ukraine
The two-month closure of Shanghai at the end of March has exacerbated economic difficulties. To assess the impact of the blockade and the war in Ukraine, the Chamber of Commerce conducted a follow-up study in April. In this second survey, 23% of companies surveyed plan to relocate out of China due to health constraints. This is the highest proportion in the last 10 years.
«Harmful»For investments
Overall, 92% of companies say they have suffered supply problems, with three-quarters saying their operations have been disrupted by Covid-19 control. Zero Covid strategy generates “huge uncertaintyfor businesses that “harmfulBetina Schoen-Behanzin, Vice President of the Chamber of Commerce, told AFP about the investments. «We really hope that China will wake up, reopen its borders and find a way out.This health strategy, which is harmful to the economy, he claims.
However, despite the disappointments, European businesses “Do not leave China because the market is so big“, with”Many opportunities for growth ahead“- says Mrs. Shion-Behanzin. they “review:but the extent of their presence in China ևredirect:their future investments, he warns. «The world is not waiting for China. If there is no change, he is sure that companies will start thinking about backup plans and go to other markets.he assures.
Source: Le Figaro
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