U.S. firms taking China’s side in trade war, AmCham survey finds
July 17, 2018 Category China News Round-up, Weekly
More than 60% of U.S. companies operating in China are bullish about their prospects as the country’s digitalization drive deepens, making business easier and more cost-effective, according to the American Chamber of Commerce in Shanghai. Most of the firms are also against the tit-for-tat trade war between China and the U.S., with some of them continuing to seek the Chinese authorities’ approval to expand their investments. Based on a survey of more than 400 American companies, the Chamber said that American businesses “continue to perform well in China”, shrugging off the gloomy sentiment brought about by rising trade frictions between the two countries. About 62% of responding businesses expected to increase investment in China this year, up from 53% that expected to in 2017.
“Uncertainty about the U.S.-China trade policy had a limited impact on investment and more companies are producing goods solely for the Chinese market,” AmCham Shanghai wrote in its 2018 China Business Report. “We hope U.S. firms can do more to lobby the U.S. government and work hard to safeguard their own interest,” China’s Ministry of Commerce Spokesman Gao Feng said. Nearly 70% of the respondents are against the retaliatory use of tariffs to achieve U.S. President Donald Trump’s trade goal, the survey showed. American companies in the service sector, compared with their counterparts in the manufacturing industry, are more supportive of the tariffs on Chinese goods, AmCham said, as trade punishment could be a bargaining chip to gain wider market access in China. “Obviously, there are more market access barriers for the service sector,” said Eric Zheng, Chair of AmCham’s Board of Governors. “You get more people from the service sector supporting the overall trade policies.”
China’s digitalization drive has resulted in huge demand for technology hardware, software and service companies, with 85% of respondents in those sectors anticipating raising their investments in 2018. American companies in the aerospace and aviation sector also look to increase their investments in China, with 78% of the respondents pledging to plough additional capital in the country this year, the South China Morning Post reports.
Companies declaring China as their No 1 investment priority rose by 3 percentage points to 27%, while 30% listed it as their second or third priority.
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