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Opinion | China, a land of opportunity for EU firms willing to adapt
- Beijing’s policy goals and restructuring mean growth, mostly in domestic consumption, will increasingly come from fields in which EU firms excel
- Rather than see China’s industrial transformation as a threat, European companies should identify opportunities and align their strategies
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Talks on the China-EU investment agreement have entered a critical phase. While sticking points remain, last week’s virtual summit between Chinese and European leaders raised hopes of a deal this year. President Xi Jinping said talks should be expedited and German Chancellor Angela Merkel noted that the “political will is there on both sides”.
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The agreement would be a confidence boost for EU investors at a time when CEOs are reassessing the role of China in their global strategies. Contrary to the narrative of decoupling, China remains a crucial growth market for European firms.
Many are choosing to double down on their commitment to the country. In the latest survey by the European Chamber of Commerce in China, more than 60 per cent of respondents said China continued to be a top-three investment destination.
There are good reasons for this optimism, not least China’s robust growth outlook and huge market of 1.4 billion consumers. As chamber president Joerg Wuttke noted at the recent Inbound-Outbound Forum, hosted by the Centre for China and Globalisation, China is expected to account for as much as 30 per cent of global growth in the next decade.
China is the only major country expected to grow in 2020, according to World Bank forecasts. Rising incomes and supportive policies will spur domestic consumption.
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Coronavirus backlash further fraying China’s ties to global economy
Coronavirus backlash further fraying China’s ties to global economy
China’s policy goals and restructuring mean this growth will increasingly come from fields in which EU firms excel. The 14th five-year plan will seek to orient China’s economy to high-quality consumption, innovation and broader quality-of-life measures such as health and the environment.
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