China: European companies suffer from export controls and look abroad
The trade dispute between China and the USA also affects European companies: new export controls are causing delays, a survey shows.
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China's export controls are having a significant impact on the business of many European companies operating there, with some fearing production delays or even interruptions. This is according to a survey by the European Chamber of Commerce in China, which was presented now. According to the survey, 40 percent of the affected companies are suffering from delivery delays of up to two months. Another equally large group expects "significant disruptions" to their supply chains. About a third of respondents also plan to source goods from other countries in the future. Another equally large group wants to build capacity outside the People's Republic with suppliers outside of China.
Preventing further loss of trust
The figures show that China's export controls have increased uncertainty among European companies in the country, summarizes the head of the advocacy group, Jens Eskelund, the results. The situation is exacerbated by the reactions of China's trading partners, which would further burden a global trading system that was already under pressure. However, since many companies are still in the process of adjusting their supply chains, there is still an opportunity to find a sustainable solution, adds his deputy, Stefan Bernhart. He sees a general licensing procedure as such a solution, which could guarantee the necessary stability and predictability. This could prevent a further loss of trust.
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One in four of the affected companies produces goods in China and is already affected by the controls. 50 percent have suppliers or customers who have goods produced in the People's Republic that are impacted. China began controlling exports of rare earth elements in the spring. A further tightening of the procedure occurred in the fall. However, this was then suspended. Many of the companies surveyed now complain that promised deadlines for the controls are not being met, which is extending delivery times. In addition, 11 percent are concerned that they will have to disclose sensitive information about copyrighted goods as part of the controls. Even more believe that too much data is being requested overall.
The survey was conducted from November 6 to 24, and 131 companies participated. Of these, 56 responded that they were not impacted, after which the survey ended for them.
(mho)
