US, EU Firms Face Low Confidence in China

American and European companies in China are facing historically low business confidence due to the country's economic slowdown and ongoing geopolitical tensions. The American Chamber of Commerce in Shanghai reported only 66% of its members were profitable in 2023, while the European Union Chamber of Commerce noted a 29% drop in EU foreign direct investment. Both chambers highlighted the lack of optimism and increasing challenges in the Chinese market, including weak domestic demand, regulatory barriers, and a politicized business environment. The EU Chamber's president, Jens Eskelund, remarked that many firms are reconsidering their investments as the difficulties of operating in China begin to outweigh the benefits. The need for substantial economic reform and credible plans to boost demand were emphasized by both American and European business groups.