About the Report
The Doing Business in China Report 2022 details experiences and opinions of 160 Australian organisations operating in or doing business with China. Following surveys in 2017 and 2018, this is the third instalment of a longitudinal study, which was conducted during April and May, prior to the Australian federal election.
The report is a joint initiative between the China-Australia Chamber of Commerce (AustCham China), University of Melbourne, Australia China Business Council, Australian Chamber of Commerce in Hong Kong, and Australian Chamber of Commerce in Shanghai, and was supported by the National Foundation for Australia China Relations.
The 2022 survey provides valuable insights from senior executives about their experiences, opportunities, challenges, and overall outlook, arising from the international turbulence of recent years.
Report Purpose:
The Doing Business in China Report helps Australian businesses understand the opportunities and challenges facing companies in China. With China’s international borders having been closed since March 2020, the findings of this year’s report are a valuable reference for Australian political leaders, policy makers and business leaders alike.
This report shows the resilience and adaptability of Australian companies doing business in and with China. Considering the challenging operating environment, the survey results are encouraging and speak to the underlying demand from Australian companies, and their desire to be present in the Chinese market.
Key findings include:
- For 58% of respondents, China is either the top or one of the three top priorities for global investment plans over the next three years.
- More than half the survey respondents were optimistic about market opportunities and growing profitability in China over the next two years.
- Top challenges facing businesses were the impacts of China’s international travel restrictions and zero-COVID policy on the movement of people and goods, followed by the effects of trade sanctions and tariffs on some of Australian products.
- The state of China-Australia bilateral relations was identified as the top risk affecting companies’ future investments in China.
- The pandemic caused sales and profitability to decrease significantly in 2021 compared with 2019 levels, but still 82 % were profitable or broke-even. Over the same period, 36% of respondents reported a reduction in headcount and 31% a reduction of their investments in China.
- Coping strategies were in evidence with 46% of respondents shifting to localise both their sourcing and sales within China, up from 19% in 2018. Those sourcing in China for sales in third-countries other than Australia increased to 20% from 7% in 2018.
- At the time of the survey, there was a notable increase of respondents expecting to maintain or increase investment levels during 2022 compared to 2021; with 66% planning to return to or exceed pre-pandemic levels. Among respondent companies, similar trends were observed for headcount and profitability in China.
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