Survey: European Union companies seek alternative options due to Chinese export inspections

European businesses are increasingly exploring suppliers outside China in response to export restrictions imposed by Beijing, a recent survey revealed. About 32% of respondents informed the European Union Chamber of Commerce that they are considering sourcing affected products from other regions, while 36% intend to develop supply chains beyond China.

These restrictions, targeting rare earths, were introduced by China in April during a trade dispute with the United States. As the leading global producer of rare earths, China plays a critical role in supplying materials essential for industrial, high-tech, and defense applications.

Among the 75 companies surveyed by the EU Chamber of Commerce, 24% indicated that they produce goods in China impacted or potentially impacted by these export limits. Meanwhile, 68% reported that their international production relies on Chinese inputs now or in the future under export control measures.

Importing rare earths from China requires companies to complete a detailed application process with the Ministry of Commerce. Around 40% of surveyed EU firms stated that approval times exceed the 45-day period promised by Chinese authorities, adding more than two months to delivery schedules. Additionally, 11% expressed concern about revealing sensitive intellectual property during the application process.

"China's export regulations have heightened uncertainty for European companies operating in the country, creating risks of production delays or potential stoppages," said Jens Eskelund, president of the European Union Chamber of Commerce in China.

Author: Sophia Brooks