Foreign business investors are finding it still difficult to ever do business in China, in spite of the hope that it is China that will pull the world out of the recession.

Foreign business isn’t exactly booming in China. “China accounts for less than 2% of the global sales of drugs giants such as Pfizer, AstraZeneca and Bayer.’ On the other hand, ‘Procter & Gamble (P&G), a consumer-goods giant, is reckoned to generate only a bit over $3 billion annually in China, less than 5% of its overall sales.’ Over at the competition side, ‘Unilever is thought to sell less than half as much; its local operations are barely profitable.’

The global recession shifted the gaze of international business to China. Multinational business interests were ‘keener than ever to capitalize on China’s growth.’ But the potential of business boom in the communist regime is largely a myth.

According to Ronald Schramm, a visiting professor at the Chinese European International Business School, “Europe and America’s exports to China have remained broadly flat over the past year and amount to less than 7% of the total, even though shrinking exports to other countries flatter the figure. Even if the Chinese economy grows by the official target of 8% this year, the impact on Western firms’ total sales would be little more than a rounding error.”

China remains to be a tough business environment. There have always been ‘explicit legal impediments and hidden obstacles’ that persist to ‘hamper access to Chinese customers, despite China’s promises of reform when it joined the World Trade Organisation (WTO) in 2001.’

Via Economist.com