COFACE CHINA CORPORATE PAYMENT SURVEY: INCREASING RISKS IN SUPPLY CHAIN DISRUPTIONS AND RISING RAW MATERIAL PRICES
Coface’s 2022 China Corporate Payment Survey shows that fewer firms encountered payment delays in 2021, but those that did report longer periods of overdue payments than in the previous year. The average payment delay rose from 79 days in 2020 to 86 days in 2021. Firms in 9 out of 13 sectors reported an increase in payment delays, led by agri-food, which recorded the largest increase of 43 days, followed by wood, transport, and textile.
More companies are reporting ultra-long payment delays (ULPDs), which are payments overdue by more than six months, rising from 15% to 19% in 2021. More worrying, there was a significant increase in those facing ULPDs exceeding 10% of their annual turnover, jumping from 27% in 2020 to 40% in 2021, notably the construction and agri-food sectors.
With China’s economic growth projected to slow in 2022, fewer companies are expecting an improvement in sales and cash flow.
Coface expects China’s GDP growth to slow to 4.8% in 2022, following a strong 8.1% in 2021, as the Chinese economy continues to face significant headwinds to growth, including a property sector downturn, the pursuit of zero-COVID policies, subdued consumption recovery, and higher commodity prices.
 The 2022 China Corporate Payment Survey was conducted between November 2021 and January 2022, and surveyed over 1,000 companies across 13 broad sectors located in mainland China.
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