China’s business environment is becoming increasingly politicized and foreign firms are having to compete against an evermore dominant state sector, according to a leading European business group, reported the South China Morning Post.
In its annual survey, the European Union Chamber of Commerce in China for the first time asked its member companies about the political environment in the country.
About 43% of the respondents said the business environment in China had become more political and they felt pressured to take action, “sometimes under threat of punishment by authorities.”
The report also highlighted the need for “bold and binding” changes to state-dominated sectors to make the market fairer and more attractive to foreign investors. “China is moving towards a ‘one economy, two systems’ model,” the chamber said.