Flash Surveys

Competitiveness of German Companies in China

Published on April 10, 2024

Chinese and German companies are increasingly becoming close competitors - both in China itself and in global markets. This is the reality that German companies must prepare for. They strengthen their competitiveness through increased investment in their China business and cooperation with partners and customers. The sluggish development of the Chinese economy coupled with the emergence of local competitors has made the issue of unfair competition in China more pronounced. The German Chamber of Commerce in China has launched a survey among its member companies to establish the status quo of the competitiveness of German companies in China. The German Chamber is strongly advocating for fair competition conditions with the Chinese government. Especially against the background of increased entry of Chinese providers into the European market, a level playing field must be implemented.

Key findings:

• Two-thirds of the surveyed companies say they are affected by unfair competition.
• German companies consider themselves superior to their Chinese competitors in terms of product quality, technological leadership, and innovation strength.
• They rate their cost efficiency, time to market readiness, and innovation speed as weakest compared to Chinese competition.
• Competitive disadvantages are particularly seen in market access and access to networks (e.g., government, local authorities, access to public tenders, etc.).
• The heightened competition is expected to cause increased cost pressures, reduced profit margins, and lower market shares.

Flash Survey Cross-border Data Transfer Compliance

Published on February 21, 2024

Cross-border data transfer and data security regulations is a hot topic for our member companies. To gain a deeper understanding of the status and challenges in the compliance efforts, we recently conducted the flash survey “Cross-border Data Transfer Compliance”.

Key findings:

• Several challenges lead to relatively slow progress of compliance:  Only 8% of companies which applied passed the review. 38 % of the survey respondent don't think that the law applies to them and more than 20% plan to fulfill their reporting obligations after the release of the “Draft Regulation" by the Cyberspace Administration of China.
• Multiple application creates heavy workload for German companies: Given that there is no restriction for each company choosing only one method of application, 42% try to make multiple compliance applications using several items.
• Low transparency is the main challenge during the application process: Half of the companies surveyed who applied see unclear regulatory requirements and the inability to keep up to date with the application progress as major concerns.
• Multiple internal and external factors complicate data processing: Vague definitions of important data (54%), unclear amount of data (50%) and heavy workload (50%) are the biggest challenges during the data processing for German companies.
• Many companies are still in a wait-and-see-mode: Two thirds of the companies that plan but have not yet started to apply think that they do not fall under the scope of the regulation and 56% wait for the release of the important data catalogue. 
• Companies suffer from heavy costs: 85 % of surveyed companies have already made some investment. The biggest impact of compliance with cross-border data transfer are additional compliance costs (70%) and increased communication costs & risks for communication with headquarters (57%).

Flash Survey: Business Outlook Restrained by Market Development & Geopolitics

Published on June 8, 2023

The results of a Flash Survey which indicate that German companies' business sentiment towards China post-COVID is not as optimistic as initially hoped. The slower-than-expected market development, as well as ongoing geopolitical tensions, have dashed hopes for a quick improvement in the business environment. Jens Hildebrandt, Executive Director & Board Member of the German Chamber of Commerce in China - North China summarizes: “Geopolitics have a profound impact on companies on the ground, prompting them to drive forward localization and diversification strategies as risk management measures”. He adds: “German companies will sustain investments in the Chinese market as a means of remaining competitive and leveraging its potential”.