The European Union Chamber of Commerce in China, in partnership with consultancy Roland Berger, released its Business Confidence Survey 2025 on Wednesday, revealing that while European companies report more operational challenges in China, many are simultaneously deepening their local supply chain investments. 

73 percent of surveyed companies – a 5 percentage-point increase year on year – stated that operating in China became more difficult in 2024. Respondents cited intensifying market competition, regulatory complexities, and geopolitical uncertainties as pain points. 

Against this backdrop, 26 percent of firms reported onshore supply chains to China, up 5 percentage points year on year. This divergence underscores China's dual reality: a tougher business climate paired with enduring supply chain advantages.

"China's economy is stabilizing with slower growth and greater competition, signaling transformation rather than decline," said Denis Depoux, global managing director of Roland Berger. Multinationals must now highly-localize operations, from R&D to customer service, to remain competitive, he added.

China's unrivaled ability to deliver high-quality components at competitive costs continues to anchor its supply chain dominance. The one place where companies actually get better components at a lower price than anywhere else in the world is here in China, emphasized Jens Eskelund, president of the European Union Chamber of Commerce in China.

China's recent policy shifts aim to reassure foreign investors. The Private Economy Promotion Law, enacted May 20, establishes legal safeguards for fair competition, financing access, and innovation support. 

The State Council's April 18 meeting pledged stronger financial backing for the economy, with the People's Bank of China subsequently implementing rate cuts to sustain liquidity.