The proportion of German companies that have either left China or are planning to leave China has more than doubled to 9% over the last four years, based on a survey from the German Chamber of Commerce in China.

According to Reuters, 2% of the companies with operations in China surveyed said that they were selling off their business operations there, while another 7% said they were considering a sell-off. In 2020, just 4% of German firms were exiting or were planning to exit China. The survey also showed that 44% of German firms have taken steps to address risks linked to maintaining operations in China.

“Last year was a reality check for German companies operating in China,” said Ulf Reinhardt, chairman of the German Chamber of Commerce South and South West China.

German firms in general have a gloomy view of the short-term prospects for the world's second-largest economy, indicated by 86% of those surveyed saying the Chinese economy is on a downward trajectory. However, most of the respondents said that they believed this trend would only be temporary, predicting an economic bounce-back over the next one to three years.

A majority of German firms, however, are not dissuaded by geopolitical tensions or economic trouble in China. Fifty-four percent of survey participants said they are planning to increase their investments in order to remain competitive in the region.

A total of 556 German firms were surveyed between September 5, 2023, and October 6, 2023, for the German Chamber of Commerce report.