A multitude of economic and political factors, which include the ongoing geopolitical tensions amid the war in Ukraine, China’s anti-business ‘Zero COVID’ policy, human rights violations, and the Taiwan Strait Conflict, have deteriorated relations between China and Europe. Due to this, European countries are increasingly scrambling to look for new options as they continue to remain hesitant about new investments in China amid economic uncertainty just a few years ago, China became Europe’s biggest trading partner. European investment in China has been through a few big companies. “Virtually no new European firms have chosen to enter the Chinese market in recent years,” said the group.
“A few big firms are propping up the numbers there. Many others are reassessing their presence, “said Noah Barkin, the managing editor of Rhodium’s China practice. Moreover, Nomura Holdings, a global financial services group, has downgraded its forecast for China’s 2023 annual growth to 4.3% from 5.1%. Goldman Sachs also slashed the growth to 4.5% from the earlier projection of 5.3%. Nowadays, countries like Britain are openly expressing their dismay with Chinese policies. China’s human rights violations of its minority communities in Xinjiang, Tibet, violations of basic rights in Hong Kong and security threats are among the reasons why the west is keeping its distance from China in terms of new investment and economic activities.In a display of disagreement towards the Chinese policies, the UK has blocked Chinese tech giant Huawei. It has also revoked the license of the Chinese broadcaster CGTN, and granted refuge to millions of dissenters from Hong Kong.