(28 May 2025)
RESTRICTION SUMMARY:
ASSOCIATED PRESS
Beijing, China – 28 May 2025
1. Wide of media briefing by European Chamber in China
2. Wide of Jens Eskelund, President of European Chamber in China, on the left
3. Close of flags of China and the European Union
4. SOUNDBITE (English) Jens Eskelund, President of European Chamber in China:
“Business confidence in China amongst European companies have sunk to the lowest level we have on record. And we have done this for 22 years running now. There are multiple reasons for that. We also see, maybe not unsurprisingly related to the low level of confidence, that when we look at the two-year perspective ahead, optimism has also hit an all-time low. We’re beginning to see now that this insecurity, uncertainty about the future, and the squeeze that many companies are feeling on their earnings is beginning to spill over in operational strategies.”
5. Logo of European Chamber
6. European Chamber staffers at briefing
7. SOUNDBITE (English) Jens Eskelund, President of European Chamber in China:
“Slightly more than half of our members are planning on engaging in cost cutting in 2025. I think, again, this is a concern because these are the things that are beginning to affect employment and tax payments.”
8. Various of reporters
9. SOUNDBITE (English) Jens Eskelund, President of European Chamber in China:
“Our members are telling us that their primary concern is the state of the Chinese economy. It’s China’s economic slowdown. Now truth be told and also in all fairness to China, we actually see demand growth. But the underlying problem for European business is that we now, for a year and a half, have seen manufacturing output outpacing what the local domestic market is able to absorb. So even if we have respectable demand growth, the fact that there has been so much additional investment into manufacturing for which maybe there is no real market in China, that is what has led to deflation or under-utilized manufacturing capacity and a pressure to export.”
10. Wide of Eskelund speaking
11. Wide of briefing
STORYLINE:
European companies are cutting costs and scaling back investment plans in China as its economy slows and fierce competition drives down prices, according to an annual survey released Wednesday.
Their challenges reflect broader ones faced by a Chinese economy hobbled by a prolonged real estate crisis that has hurt consumer spending.
Beijing also faces growing pushback from Europe and the United States over surging exports.
Jens Eskelund, the President of European Chamber in China, said about one third of member companies plan to cut cost in 2025, with potential implications for tax contribution and employment.
Their main concern stems from China’s economic slowdown, followed by China-US tariff war, according to the survey.
The same forces that are driving up Chinese exports are depressing the business outlook in the Chinese market.
Chinese companies, often enticed by government subsidies, have invested so much in targeted industries such as electric vehicles that factory capacity far outpaces demand.
The overcapacity has resulted in fierce price wars that cut into profits and a parallel push by companies into overseas markets.
In Europe, that has created fears that growing imports from China could undermine its own factories and the workers they employ.
The EU slapped tariffs on Chinese EVs last year, saying China had unfairly subsidized electric vehicle production.
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