European companies in China are facing a paradox: tougher business conditions and deeper local investments. A new 2025 survey by the European Union Chamber of Commerce in China and Roland Berger reveals 73% of firms found operating in the country more challenging in 2024—up 5% from last year. Yet 26% are expanding local supply chains, betting on China’s manufacturing muscle.
Why the Mixed Signals?
Market competition is heating up like a K-pop dance-off , with regulatory hurdles and geopolitical tensions adding to the stress. But here’s the kicker: China’s ability to deliver high-quality, low-cost components remains unmatched, according to Jens Eskelund of the EU Chamber. Think of it as the 'Taylor Swift effect'—everyone wants a piece of the magic, even if tickets are pricey.
Localize or Lose
Roland Berger’s Denis Depoux says companies must now go hyper-local, from R&D to customer service, to stay competitive. China’s new Private Economy Promotion Law (enacted May 20) and recent State Council financial measures aim to sweeten the deal for foreign investors.
The Bottom Line
While growth slows, China’s economy is stabilizing, not collapsing. For global firms, it’s a high-stakes game of chess—navigate the challenges, reap supply chain rewards.
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Firms Navigate China Challenges While Doubling Down on Supply Chains 
, with regulatory hurdles and geopolitical tensions adding to the stress. But here’s the kicker: China’s ability to deliver high-quality, low-cost components remains unmatched, according to Jens Eskelund of the EU Chamber. Think of it as the 'Taylor Swift effect'—everyone wants a piece of the magic, even if tickets are pricey. 
China's Business Boom: Why Foreign Firms Stay…
