Survey: Majority of German companies face unfair competition in China

Around two thirds of German companies operating in China say they experience unfair competition, according to a survey by the German Chamber of Commerce Abroad (AHK) ahead of Chancellor Olaf Scholz’s visit to the country.

Scholz should communicate to high-level Chinese officials that German companies in China are facing problems which stand in the way of further success, said Maximilian Butek, head of the German Chamber of Commerce in East China.

“The expectation is that Chancellor Scholz will explain the challenges we face here,” he said.

Many of the approximately 5,000 German companies doing business in China have been complaining about what they see as unfair competition in the market, especially as Chinese companies begin to catch up technologically with Western rivals.

According to the survey, companies face disadvantages such as more difficult market access and difficulty in accessing the government, local authorities and public tenders.

The majority of the 150 AHK member companies that took part in the survey came from the mechanical engineering, automotive and business services sectors.

At 52%, Chinese private companies are the main competitors for the Germans. Almost all respondents (95%) saw the intensified competition as having an impact on their business and cited increased cost pressure, reduced profits and lower market share as the main consequences.

Scholz is travelling to China for three days on Saturday to meet China’s head of state and party leader Xi Jinping. It is the chancellor’s second trip to the People’s Republic since taking office in December 2021.

©dpa