European firms increase investment in China after quick COVID recovery

European businesses have seen higher margin in China than globally and are increasing investment in the country following its quick recovery from the COVID-19 pandemic last year, according to a report.

The proportion of European companies planning to expand China operations in 2021 jumped to nearly 60 percent from 51 percent last year, as per the report on Tuesday, citing a survey by the European Chamber of Commerce.

About half of the 585 surveyed respondents reported higher profit margins in China than their global average, while the proportion was 38 percent last year, Xinhua reported.

Additionally, 73 percent of the respondents reported a profit last year, with another 14 per cent breaking even. The figures were about the same level as in previous years despite the pandemic disruption, reflecting the speedy recovery of the Chinese economy, the report observed.

"The resilience of China's market provided much-needed shelter for European companies amidst the storm of the COVID-19 pandemic," the survey said.

Meanwhile, a quarter of the surveyed businesses are "onshoring" their supply chains in China, the report added.

"The main point is to develop supply chain as mush as possible here, as far as it's possible, to provide what's needed for the market here," the report quoted Charlotte Roule, a board member of the chamber, as saying.