Chinese mergers and acquisitions activity is expected to have another “robust” year in 2018, according to a report by global accounting firm EY. Trade tensions have failed to hold back companies from pursuing their “go global” ambitions and M&A activity by private equity firms. Chinese companies are more optimistic about economic and market conditions, and expect the M&A market to remain upbeat, EY said in its latest “Capital Confidence Barometer”, a global survey of more than 2,500 senior executives in 43 countries conducted twice a year since 2009. For the first time, 99% of Chinese respondents said they saw an improving or stable economy, at home and abroad.

“We do not see rising protectionist action by governments as having a major impact on M&A activity, as executives understand that dealing in a globalized market is necessary,” said Bernard Poon, Managing Partner of Transaction Advisory Services at EY in Hong Kong and Macao. The survey was conducted in March and April, at a time when there were signs of a full-blown trade war between China and the United States.

About 40% of respondents said changes in trade policy and protectionism were near-term threats to business growth. However, Chinese businesses still ranked portfolio transformation at the top of their agenda. A majority of Chinese companies said they had confidence in the M&A market, on the back of a record first quarter of deal making in 2018.

Mainland China and Hong Kong reported a 32.8% fall in outbound M&As from a historical high of USD204.2 billion in 2016 to USD137.1 billion in 2017, according to a report by Mergermarket. “Current M&A activities are no longer dominated by corporate acquirers, but private equity, which has rebounded since 2017,” said Erica Su, Managing Partner at EY Transaction Advisory Services in Greater China, the South China Morning Post reports.