In particular, large corporations such as BASF and BMW continue to enter the market because of the long-term growth prospects.
(Photo: dpa)
It is paradoxical: while Europe is returning to normal this year, at least with regard to the corona pandemic, the third year of the pandemic has been the worst for companies in China so far.
Not only German companies are complaining about extremely difficult business in the People’s Republic in view of the constant lockdowns in recent months. The Chinese economy as a whole is also in bad shape – consumption has collapsed, the real estate crisis is continuing and now exports are also weakening.
More and more companies are taking action and prefer to invest their money elsewhere. That should give the Chinese government something to think about.
Because it’s not the case that German companies want to stay in China at any price. It is true that large corporations such as BASF and BMW in particular continue to bet on the market because of the long-term growth prospects.
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Ultimately, in this regard, they also act as driven. The sheer volume of past investments more or less forces them to do so.
“Of course the world is not black and white”
However, those companies in particular that find it difficult to cope with the political arbitrariness of Chinese politics are reducing their involvement and withdrawing a little. They take jobs and technology with them.
The European economy has repeatedly warned that the constant lockdowns and the ongoing tough restrictions on international travel are poison for companies – now the full extent of the damage is becoming apparent.
The world is of course not black and white. Now that the corona restrictions have been relaxed, after a period of chaos that has to be feared, normality will hopefully return, at least in the long term.
>> Read here: Business confidence in German companies in China is at a “historic low”
Then one or the other company will reconsider its investment decisions in favor of China. Despite all the difficulties in many areas, China remains an important growth market.
But that year, a lot of trust in the market was irrevocably destroyed. Under the ideology-driven head of state and party leader Xi Jinping, China is no longer the business-friendly anchor of stability that it used to be.
The economy is still important to the leadership, but ideological goals are clearly in the foreground. A return to the times before the pandemic is extremely unlikely – especially since China’s isolationist tendencies have been apparent for years.
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