European business confidence in China may be nearing an inflection point after years of decline, according to a European Chamber survey released Wednesday.
The survey found that 68% of respondents said doing business in China got harder over the past year, down five percentage points. Those reporting more politicization fell five percentage points to 47%. Optimism on two-year profitability rose five percentage points to 17%.
Still, serious challenges remain, including China's economic slowdown and persistent supply-demand imbalances. About 32% of respondents reported being impacted by export controls and 39% see the enforcement of intellectual property rights laws and regulations as inadequate.
European Chamber President Jens Eskelund said despite the "signs of an uptick" in business confidence, margin pressure stemming from persistent low domestic demand relative to supply growth "remains a core issue."