Faith in China´s Economic Conditions Drops

The Swedish SEB´s China Financial Index has dropped from 70 to 63.4 since May 2010. The index measuring top executives, from North European subsidiaries in China, views on business conditions and earnings growth.

China is still going strong though, as a survey from SEB tells that around 25% of companies are planning huge investments over the next six months. Eight out of ten companies are planning new recruitment but considerably fewer businesses than ever before say they intend to
increase the number of employees significantly.

The share of companies who says they are positive or very positive about the next six months falls to 48 percent, compared with over 80 percent in the last survey six months ago.

Less than half of the companies now believe that profits will increase in China when compared with two thirds of the previous survey.

The greatest concern is falling consumer demand, finding qualified staff and the high costs of raw material.

SEB predicts that China will experience 8.4 percent growth in 2012.

The full report is available at www.sebgroup.compress

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