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Most European companies operating in China are already experiencing a positive impact of the country's trade war with the United States or expect to do so, because higher Chinese prices assess US imports out of the market, according to a survey.
The results of the European Chamber of Commerce survey in China indicate that its members, while also suffering from the overall economic war impact of US President Donald Trump, could take market share from American suppliers, including manufacturers.
The survey, which was conducted last month, revealed that 19% of the companies that responded already received more affairs from Chinese and foreign customers operating in China due to the trade war. He found that 36% had not yet had a positive impact, but planned.
“What we mean anecdotal is that there are a number of European companies that are in competition with American companies and perhaps in particular with America imports,” said Jens Eskelund, president of the EU Chamber.
“Where they see an opportunity, (east) if these imports (United States) were dried up and China will have to find suppliers, non -American suppliers, elsewhere – that it could lead to potential advantage,” said Eskelund.
However, he pointed out that this did not mean that European companies had a “measurable” clear advantage of the trade war, economic slowdown and uncertainty weighing on profitability and investment.
China has built the most formidable export machine in the world but foreign companiesIncluding those in the United States, there are still a role, especially by providing high-end machines and industrial inputs.
Companies entirely or partially held by foreign investors represent approximately 30% of the commercial value of China, many of which use imported inputs to produce goods in China for sale locally or for export.
The EU Chamber Survey showed that the 125% of the prices imposed by China on imports from the United States had a greater impact on its members than the 145% of Trump price on Chinese imports.
About 44% of respondents said they imported goods or supplies from the United States that have been affected by Chinese prices, the majority claiming that the price of these items had already increased or increased.
The majority of those questioned said they would respond to higher prices on American products by changing suppliers.
Only 31%, however, said they were affected by American prices on Chinese products.
The results differ slightly from a separate survey of the German Chamber of Commerce in China, also carried out last month. This survey revealed that more members were affected by American prices on Chinese products, but mainly indirectly.
The two surveys suggested that the trade war had seriously damaged businesses, but that European companies were still advancing “location” strategies for their Chinese operations – a question of concern for political decision -makers in Brussels.
This location has meant increasing local supply for their operations in China in order to reduce dependence on imports and reduce geopolitical risk for their Chinese supply chains.
“Even if you have all this tension here … if you will be able to compete on the price and the quality, China is always the place you need to be,” said Eskelund. “So, even if everyone is talking about disintegration and everyone wants to become less dependent on China, we actually see the opposite.”
He said the trade war did not stop this trend. “We actually see, in some ways, dependencies with regard to China's growth, not decreasing.”
