Nearly 60% of respondents said that mounting accounts receivable had gradually eroded their profits . In some cases, the cash-flow crunch pushed companies into outright financial distress . This echoes earlier findings from the same institute: in March 2026, entrepreneurs were already calling for the government to use treasury bonds and legal obligations on state-owned enterprises to break the country's interlocking debt chains . A 2025 report by the EU SME Centre similarly noted that payment delays remain a structural weakness in the business environment .
Consumer spending inside China continues to underperform, dragging down sales for companies that rely on the domestic market . The World Bank's June 2025 China Economic Update flagged subdued demand as a persistent risk , and KPMG's 2026 Q1 monitor similarly noted that the recovery is