February 27, 2020 / 7:35 AM / a month ago

Most European firms in China expect revenue drop due to coronavirus -survey

BEIJING, Feb 27 (Reuters) - Most European firms operating in China expect revenue to fall in the first half of this year because of the ongoing coronavirus epidemic and consequent government control measures, showed a poll by business groups on Thursday.

The virus’ impact is “comprehensive and severe” with a quarter of businesses expecting revenue to fall by more than 20%, showed a survey conducted by the European and German chambers of commerce in China.

In China, the epidemic has killed more than 2,700 people, infected more than 78,000 and led to widespread transport and business restrictions.

Unpredictable, inconsistent rules and restrictive quarantine measures were among the biggest complaints from respondents, of which about a fifth were in the automotive industry and another fifth were in the industrial equipment and machinery industry.

“The patchwork of conflicting rules that emerged from the fight against COVID-19 has produced hundreds of fiefdoms, making it next to impossible to move goods or people across China,” said Joerg Wuttke, president of the European Union Chamber of Commerce in China, in a statement accompanying the survey.

COVID-19 is the illness caused by the virus.

Nearly half of respondents said they plan to lower annual business performance targets due to the virus, with 56% saying the virus has caused a drop in demand for products or services.

Supply chains might take “a few more weeks” to recover as sub-suppliers have not yet received approval to start work again, said one respondent, a company with operations in the eastern province of Jiangsu.

Nearly half of respondents said they could not meet contractual delivery times because of disruptions caused by the virus. (Reporting by Gabriel Crossley; Editing by Christopher Cushing)

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