European Companies Foresee Chinese Growth

European companies remain optimistic about growth in China, but want to see faster reforms as the country faces a leadership transition, a European business group said Thursday.

Investment from Europe to China has been steady despite slight declines in the past several months, Davide Cucino, president of the European Union Chamber of Commerce in China (EUCCC), told Xinhua in an interview.

“Even in moments (of economic weakness) like this, we have indications from our members that they believe there is still room for growth and room for profits in China,” he said.

Increased consumption, a stronger service sector, accelerating urbanization and innovation will drive China’s mid- and long-term growth, although the country has to face a slowdown in the short term, Cucino said.

However, EU firms would like to see more reforms implemented, which is urgently needed for a transition into the new growth model, he said.

In an annual position paper released Thursday, the EUCCC pushed China for reforms to substantively reduce state involvement in the business environment and give full play to market principles.

“As the next five years will be critical, China’s leadership transition provides an ideal opportunity for these bold steps to be taken,” the paper said.

via ECNS

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza