European Union Chamber of Commerce in China Report on China.

Thursday, September 3, 2009 16:19
Posted in category Uncategorized

As a blogger, there are times where I feel an urge.  An urge to be honest, let it all go, and get something off my chest.

Ususally I don’t.  I restrain myself for the greater good ..

The EU Chamber on the other hand has jsut released a 600 page report (Exec Overview and PPT Overview here) detailing where improvements can be made, and from the powerpoint alone it is clear that there are some deep issues to be dealt with.  As shown through the press release:

Market Access– The archaic 50/50 Joint Venture requirement continues to hinder market development.
– Equal treatment for domestic and foreign companies is conspicuously absent in the public procurement process.
– In some sectors, technical regulations and certification procedures are being used to limit market access, and in certain cases to push foreign-invested companies out of certain markets altogether.
– A noticeable lack of reform and opening up remains in the service sector and hinders the development of strong domestic consumption.
– The limited market access and opportunities for foreign companies in energy-related sectors restricts China’s efforts to fight climate change.

EU-China Trade Relations
– China is important for the EU but the EU is more important for China.
– EU exports to China represent 0.7% of EU GDP; China’s exports to the EU represent 7% of China’s GDP.
– About 40% of technology transfers introduced to China through imports and investments originate in the EU.
– 20% of all Chinese exports in 2008 went to the EU (USA 17%, Japan 9%).
– A 1% decline in EU GDP growth would lead to a 11.5% decline in Chinese exports (just 9.8% for US).>

Transparency in Legislation and Implementation
– The time granted publicly for comments on draft legislation is still well short of international best practices.
– Consultations on draft legislation are often limited to selected persons or groups and characterized by a disturbing lack of transparency.
– The enforcement of regulations on Chinese firms is often weaker than that on foreign firms.

Intellectual Property Rights (IPR)
– The lack of adequate IPR protection and the leakage of confidential information at various stages of business development are a growing concern, discouraging European companies from further transferring know-how and technology to China or setting up research and development (R&D) centres in China.

A few points I see are quite interesting in tht they are issues that have been issues for many over the years, and irritating so.. like issues with laws, governance, and trasperancy.

I am still left to wonder though how the EU Chamber thought that releasing this report was a good idea, or that arranging a arranging a public forum to draw in the international press would improve the hardships that European face when coming to China.  Issues, that no doubt everyone foreign company faces … and many Chinese as well.

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4 Responses to “European Union Chamber of Commerce in China Report on China.”

  1. Tim says:

    September 6th, 2009 at 6:50 pm

    Actually, the white papers that the EU Chamber releases have always been rather straightforward and have been released to the government and presented in a public forum. The idea being that as the Chamber represents the concerns of its members it can be a bit more direct than any one given European member company. As a result, the paper is heavily driven by chamber member comments and the chairs of the working groups (at least in previous years and I would assume this hasn’t changed). Given the market downturn I am not surprised that members have found themselves with more to be worried about and are now more vocal about their concerns than they may have been in previous years.
    Also, even though these issues, in many ways, have been around for a while, previous white papers were generally tempered with a sense of improvement and I suspect that, along with the general sentiment of its members, the tone of the most recent white paper reflects concerns that China began to stagnate on areas they had previously shown gradual improvement.

  2. Rich says:

    September 6th, 2009 at 7:56 pm

    Hey Tim.

    Yeah, actually I had brunch with our mutual friend from EU Chamber yesterday and discussed briefly. In essence, many of these issues were ones they had discussed with MOFCOM before, and none of this was particularly new, but the size of the document and the way the press picked up on it was (she recognized the comment about China needing the EU more than the reverse did not help).

    We both agreed that it would be interesting times when China began publishing a report of its own.


  3. Tim says:

    September 7th, 2009 at 3:34 am

    I agree, that was unusually strong and just begs the government to respond in kind instead of focusing on the real issues

  4. Creezy Courtoy says:

    August 21st, 2010 at 12:00 am

    Dear Tim,
    Can you say that on the 2nd of September ? We are organising a Sino-EU Summit in Hangzhou on the subject. I would love you to open the discussion. There will be around 40 EU brands.
    I sent you info on ASW