German business sentiment in China hits record low in ’24

Business sentiment among German companies in China has reached an all-time low, according to the German Chamber of Commerce in China.

Over half of the surveyed companies reported worsening conditions this year, with only 32 per cent expecting improvement in 2025, the lowest forecast since 2007.

Despite challenges, 92 per cent of German companies plan to maintain their operations in China. Germany is China’s largest European trading partner, with significant investments from firms like Volkswagen, BMW, and Bosch.

The chamber highlighted a Buy China trend driven by President Xi Jinping’s self-sufficiency initiative, impacting German companies. It urged Berlin to revise its China strategy to support localisation efforts.

German automakers have criticised EU tariffs on Chinese-built electric vehicles, fearing retaliatory duties on gasoline vehicles. Volkswagen recently extended its partnership with Chinese firm SAIC, despite selling its Xinjiang operations under pressure.

Attribution: Reuters

Subediting: M. S. Salama