(From L) Francine Hadjisotiriou, general manager of the European Chamber South China Chapter, Klaus Zenkel, vice president of the European Chamber of Commerce in China and chair of the European Chamber South China Chapter, and Gianluca Giorgi, vice chair of the European Chamber South China Chapter, answer questions from the media. Photo courtesy of the European Chamber South China Chapter
Seventy-Seven percent of respondents are interested in expanding their businesses in South China, and 97% of companies have confirmed their commitment to remaining in the region, showing confidence in the local business environment, according to the European Business in China Business Confidence Survey 2023 released by the European Chamber South China Chapter yesterday in Shenzhen.
“Some of the multinational companies I talked to are currently expanding due to the vast potential of the Chinese market. Some of them even expanded their operations in China for their global business,” Klaus Zenkel, vice president of the European Chamber of Commerce in China and chair of the European Chamber South China Chapter, said.
“The small and medium-sized enterprises (SMEs) still see the potential because the Greater Bay Area (Guangdong-Hong Kong-Macao GBA), including Shenzhen, is the largest in terms of size and population, compared to Tokyo Bay and San Francisco Bay. But the GDP per capita here is lower, and in this respect, the SMEs can see the potential of growth. At the moment, they are just waiting,” Zenkel explained.
Per the survey, some aspects of doing business in South China have also improved slightly, such as dealing with construction permits, accessing utilities and facilitating trade across borders.
Zenkel said that in Shenzhen, the European Chamber has around 120 members. “In general, they like this environment. They have been here for many years. There are large multinational companies as well as SMEs.”
“European companies are interested in industries that are related to decarbonization, new technologies, new materials and electric vehicles. China is now very strong in manufacturing electric vehicles. European companies are interested in establishing presence in the Chinese market for these industries. In Shenzhen, there are opportunities for companies to do R&D, because in Shenzhen we have the highest innovation output. Shenzhen is part of the GBA and in the GBA, we have everything in one place like R&D, manufacturing and financing,” he added.
Despite some positive signals, such as the willingness of companies to expand their operations in South China, European companies still face some challenges in various areas, including difficulties in getting credit/refunding, protecting minority investors, enforcing contracts, registering property, relocating and cross-border money transfers.
“In order to revitalize Shenzhen and the GBA in general, we need more certainty, more measures for talents and more access to funds for SMEs,” Francine Hadjisotiriou, general manager of the European Chamber South China Chapter, said.