BERLIN, Nov. 19 (Xinhua) -- Germany remains an important investment destination for Chinese companies in Europe, a business survey showed, even as rising labor costs, regulatory hurdles and geopolitical uncertainty continue to weigh on Europe's largest economy.
The Business Confidence Survey of Chinese Companies in Germany 2025, jointly released by the Chinese Chamber of Commerce in Germany (CHKD) and KPMG on Tuesday, found that although Germany faces persistent economic stagnation and rising layoffs, more than 100 Chinese companies operating in the country remain cautiously optimistic about their business outlook.
Forty-three percent of respondents expect moderate or strong revenue growth in the next 12 months, while 46 percent expect revenues to remain broadly stable, the survey showed. Four in ten companies plan to increase staff, with a similar proportion expecting headcount to stay unchanged.
Germany occupies a central place in Chinese companies' European operations, the survey said, with more than half of respondents designating their German subsidiaries as regional headquarters. Meanwhile, 21 percent have plans to invest in production facilities in the country over the next five years.
Andreas Glunz, managing partner of international business at KPMG in Germany, said at the launch event that Chinese companies are increasingly pursuing localization strategies in Germany as they look to build value chains in Europe and integrate more deeply through partnerships.
"Germany still has many strengths, and this creates win-win opportunities for Chinese investors," he said.
China has remained one of Germany's most active foreign investors in recent years. According to data from Germany Trade & Invest (GTAI), China continued to rank as Germany's third-largest source of greenfield investment projects in 2024, with activity concentrated in renewable energy, electronics and automation, and transport and logistics.
Glunz also stressed the importance of deeper cooperation, noting that for Chinese companies operating in Germany, the strongest cooperation potential lies in digitalization, energy-related fields such as battery technology, and the automotive sector.
However, concerns over Germany's investment environment have dampened confidence among Chinese firms. Only 13 percent of respondents described the five-year outlook as positive, while around one in three said risks outweigh opportunities. High labor costs, cumbersome regulation, and language and cultural barriers were cited as major challenges.
The report said streamlining administrative procedures, making investment screening more predictable, and improving market openness would be the most effective steps to attract further Chinese investment.
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