© Reuters. FILE PHOTO: A member of staff stands behind flags as officials arrive for UK-China High Level Financial Services Roundtable at the Bank of China head office building in Beijing, China July 22, 2016. REUTERS/Damir Sagolj

By Joe Cash

BEIJING (Reuters) -A record number of British companies are pessimistic about doing business in China and are taking a “wait and see approach”, according to a survey by the British Chamber of Commerce in China.

Increasingly strained geopolitical relationships, a slowing global economy, growing talk of self-sufficiency, and shifting investor perceptions were the top challenges clouding the business outlook, the survey released on Tuesday said.

“British companies are willing and want to invest in China…there is, however, some uncertainty around that and that’s where the survey results we have give us a little cause for concern,” Julian MacCormac, chair of the British Chamber, told reporters in Beijing.

“Seventy percent of companies are saying it is too early to make these long term commitments to the China market,” he added.

AstraZeneca (NASDAQ:), BP (NYSE:), Jaguar Land Rover and Shell (LON:) are among some of the members of the chamber.

Foreign direct investment (FDI) into China has slowed substantially since the country abandoned its strict COVID-19 curbs late last year, with dollar-denominated FDI down 3.3% in January-April compared with the same period last year.

Trade between the UK and China was worth 111 billion pounds ($140 billion) last year, according to the British National Bureau of Statistics, making China the UK’s fourth largest trading partner.

The British Chamber called on the authorities in China to provide greater clarity on how new regulations will be implemented, particularly in data security and taxation, so that there are fewer “grey areas.”

“When something happens that isn’t necessarily explained, and where businesses are not consulted and it’s not clear where the boundaries are in terms of how a company operates, it creates uncertainty,” MacCormac said, in response to a question on recent raids by Chinese authorities of foreign due diligence firms.

China’s leadership has sought to attract investment back to the world’s second-largest economy following its reopening, with Commerce Minister Wang Wentao telling U.S. firms in Shanghai on Monday that “China will continue to welcome U.S.-invested firms to develop in China and achieve win-win results.”

But business groups have also voiced frustration over mixed messaging, not least due to the crackdown on consultancies.

AstraZeneca’s China president told an audience of a few hundred participants that the global drugmaker will seek to be a patriotic company in China that “loves the Communist Party,” at an event in the eastern city of Wuxi on Friday.

($1 = 0.7923 pounds)

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