A lack of trust in doing business is one of the biggest headaches for Chinese managers, with over 90 per cent saying they have been engaged in at least one contract dispute in the last year, according to survey findings published on Monday.

In the nationwide survey of 4,695 managers, a little over seven per cent said they had been engaged in 10 or more contract disputes in the last year, while only 8.6 per cent said they had not had a contract dispute during the period, the Beijing Youth Daily said.

The lack of trust in Chinese business was mainly due to indebted companies, firms that did not live up to their commitments and those that engaged in producing fake or shoddy products, it said.

The survey was conducted by the China Entrepreneur Survey System which polled board directors, company managers, chief executives and factory managers, the paper said.

Other areas of concern included false information, poor quality or falsely advertised quality and trade mark or patent infringements.

The managers felt the worst business behavior was found in the construction and real estate industries, while the industries most likely to have indebted enterprises included mining, garment manufacturing and construction, it said.

Lack of business morals stemmed from poor implementation of laws by government departments, low level of business ethics among enterprise managers and the quest for short-term profits, it said.

According to the China Daily, 76 per cent of those polled said defaults on loan payments was their top concern, while most said establishing a good credit rating was crucial to enterprise development.

The respondents called on the government to tighten its grip on bad credit, introduce more legislation on credit and restructure the credit system.