A majority of Taiwanese businesspeople in China are pessimistic about the country’s economic future, but many still say they have no plans to reduce their investment there over the next few years, a survey covering 2022 conducted last year by the Taipei-based Chinese National Federation of Industries showed.
About 61 percent of respondents reported lower operating profits in 2022, including 20.8 percent whose profits dropped “significantly,” the survey showed.
In contrast, only 29.6 percent of respondents reported higher profits, the business group said, although the question focused on the period before China lifted its “zero COVID-19” policy in January last year.
Asked about the future of the Chinese market, respondents were split about 60 to 40 between those with negative and positive outlooks.
The survey showed that 9.5 percent were “very pessimistic,” while half said that they were “not very optimistic,” while less than 10 percent said it would be “business as usual” and about 30 percent felt “optimistic” or “very optimistic.”
Amid heightened geopolitical tensions, many US and European firms have begun looking for additional suppliers outside China based on risk management considerations, which has affected some Taiwanese businesses there, the federation said.
In terms of cross-strait relations, 44.2 percent of respondents said they had “some effect” on their business performance, while just over one-quarter said they had “a major effect.”
Less than 20 percent said cross-strait relations had “a small effect” on their business, while 10 percent said they had had no effect, the survey showed.
Although many Taiwanese businesses have yet to lose orders because of cross-strait tensions, respondents expressed concern that a spike in tensions could drive Western clients to prioritize suppliers outside China, it said.
Despite a relatively dour outlook on the Chinese market, 67.9 percent had no plans to reduce their investment in China over the next three to five years, it said.
Less than 20 percent said they planned to reduce their investment in China, while about 10 percent said they planned to invest more in the country, it added.
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