Overview
The British Business in China: Position Paper is a report created by the British Chamber of Commerce in China to provide advocacy and representation on behalf of British businesses operating in China. British businesses across a range of sectors in Beijing, Guangdong and Southwest China come together to raise the regulatory barriers that they face, areas of opportunity for bilateral cooperation and recommendations for market access reform. The Position Paper is directly presented to the UK and China governments in order to directly inform trade policy and negotiations.
This year’s Position Paper features analysis across nine sectors, from automotives and energy, to consumer goods and the built environment. Its findings are based upon dozens of interviews and roundtables with member companies, relevant stakeholders, industry experts and policy analysts, and is one of the two major annual publications from the Chamber.
In 2023 the British Chamber asked the Chinese government to take concrete steps to open up, with a particular focus on addressing key regulatory issues such as those relating to data, whilst improving communication and transparency. The government deserves credit for many of the steps it has taken to tackle these issues in the past year, but these have yet to lead to a clear return of confidence among British businesses.
Despite this, the findings of the British Business in China: Sentiment Survey 2023-2024 indicate that British companies are yet to see government measures translate into “meaningful opening-up”, with an anticipation that regulatory obstacles will increase rather than a decrease in the next five years. British business confidence is further constrained by the growing risk of increased trade tensions due to a complex geopolitical environment, which further discourages companies from making new investments in key areas.
There are signs that China is taking tangible steps to implement some of the changes outlined in their guidelines, including recent progress over the facilitation of cross-border data flows. British companies anticipate more opportunities in the market if the implementation of these measures fosters a clear, transparent and predictable business environment.
In order to achieve this, British businesses in China are calling for:
- A transparent and predictable regulatory environment to improve business confidence.Investment into the Chinese market has been stymied by repeated incidents of policies brought in without warning, challenging the perception of China as a predictable market for businesses.
- Improved consultation with business for better policy solutions. Chinese government engagement with British businesses has reached unprecedented levels in the past year; it is essential that this continues in the future, particularly in the “new quality productive forces” which will drive China’s future growth.
- Proactive engagement around overcapacity. Concerns around profit margins and the potential for increased trade barriers have stopped British businesses reaching their full potential in supporting China’s green growth; more dialogue is needed at both the governmental and business level to foster confidence.
British business welcomes the government’s ongoing efforts to improve the operating environment for international businesses, notably through last year’s guidelines and action plan.
Our members look forward to further progress in addressing sector-specific issues that hamper their ability to do business in the country. Long-term issues around obtaining key licences in areas such as the built environment sector have still not been addressed, with other sectors seeing slow progress. At the moment many companies are taking a wait-and-see approach that could easily become a move away from China as a core strategic market.
Based on the findings of our position paper, the British Chamber of Commerce in China believes there are multiple mutual growth opportunities if the Chinese government can take the initiative on key issues. Each of our positions make recommendations to support British businesses in realising their full growth potential in China for the benefit of both countries. We look forward to working with key stakeholders to ensure continuing progress in the coming year.
