Photo: VCG

Although the EU has increased its ideological friction with China, European countries have maintained their enthusiasm for expanding economic cooperation with China. Nearly 60 percent of European companies plan to expand their businesses in China this year, an increase of nearly 10 percentage points from the 51 percent surveyed last year, a survey released by the European Union Chamber of Commerce in China showed on Tuesday. 

After a rapid recovery from last year's epidemic, China has become a more important source of European economic growth and profit and European companies have increased their investment in the country.

About half of the surveyed companies said that their profit margins in China are higher than the global average, which is much higher than the 38 percent in last year's survey. 

The study is made by the chamber, in cooperation with Roland Berger, to measure the confidence of European businesses in China. The annual survey was completed by 585 companies registered with the EU Chamber of Commerce.

The report said the resilience of the Chinese market provides European companies with much needed shelter during the pandemic. As China quickly contained the COVID-19 outbreak at the beginning of last year, it became the driving force for global economy in 2020.

The report said that 73 percent of the interviewed companies said they achieved profitability last year, while another 14 percent said they reached a brake-even point. About 68 percent of respondents are optimistic about the business prospects of their industry in the next two years, up from 48 percent last year.

Approximately one quarter of the interviewed companies indicated that they are realizing the localization of their supply chains by moving their production lines to China or switching to suppliers that produce in China. 

Commitment to the China market remains strong with a mere 9 percent of respondents considering shifting any current or planned investment out of China, the lowest share on record according to the report. 

China-EU trade reached $250.3 billion in the first four months of this year, up 42 percent year-on-year. In the same period, the EU's actual investment in China reached $1.95 billion, an increase of 12.4 percent, while China's direct investment in the EU reached $1.69 billion, up 70.8 percent, according to data from the Ministry of Commerce.