US firms vote with their chequebooks, taking China’s side in trade war, AmCham survey finds
Most companies say they are against the tit-for-tat war between the world’s two largest economies
Daniel Ren
More than 60 per cent of US companies operating in China are bullish about their prospects in the mainland as the country’s digitalisation drive deepens, making doing business easier and more cost-effective, according to American Chamber of Commerce in Shanghai.
Most of the firms are also against the tit-for-tat trade war between China and the US, with some of them continuing to seek Chinese authorities’ approval to expand their investment in the world’s second-largest economy.
Based on a survey of more than 400 American companies, the business lobby group said American businesses “continue to perform well in China,” shrugging off the gloomy sentiment brought about by rising trade frictions between the two countries.
Is Tesla’s Shanghai plant announcement a matter of auspicious timing?
About 62 per cent of respondents expected to increase investment in China this year, up from 53 per cent businesses that added investment to the market in 2017.
“Uncertainty about US-China trade policy had a limited impact on investment and more companies are producing goods solely for the Chinese market,” AmCham Shanghai said in its 2018 China Business Report.
In Beijing, China’s Ministry of Commerce spokesman Gao Feng told a media briefing on Thursday that the mainland will continue to attract American investors.
“We hope US firms can do more to lobby the US government, and work hard to safeguard their own interest,” he said.
China’s response to the trade war can hit US technology industry where it hurts most
On Tuesday, the US has threatened to slap a 10 per cent tariff on a range of Chinese-made goods such as food and electronics, worth US$200 billion, in addition to duties imposed last Friday on U$50 billion of Chinese imports. Beijing has vowed to strike back.
Nearly 70 per cent of the respondents are against the retaliatory use of tariffs to achieve US 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. Trade punishment could be bargaining chip to gain wider market access in the mainland.
“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 support the overall trade policies.”
The bestselling US electric carmaker Tesla announced on Tuesday the establishment of its first overseas plant in Shanghai, with initial investment expected to hit US$10 billion.
The announcement followed Beijing’s move in April to scrap the 50 per cent foreign ownership limit for vehicles powered by alternative energy.
Manufacturing businesses continued to show improved performance for the third straight year in 2017. About 80 per cent manufacturers reported revenue growth in 2017, compared to 54 per cent in 2015 and 71 per cent in 2016, the survey said.
China’s digitalisation drive has resulted in huge demand for technology hardware, software and services companies with 85 per cent respondents in the sectors saying they will boost investment in 2018.
Aerospace and aviation sector also attracts American companies to raise their investment in China with 78 per cent of the respondents pledging to plough additional capital in the country this year.
Additional reporting by Amanda Lee
www.fotavgeia.blogspot.com
Most companies say they are against the tit-for-tat war between the world’s two largest economies
Daniel Ren
More than 60 per cent of US companies operating in China are bullish about their prospects in the mainland as the country’s digitalisation drive deepens, making doing business easier and more cost-effective, according to American Chamber of Commerce in Shanghai.
Most of the firms are also against the tit-for-tat trade war between China and the US, with some of them continuing to seek Chinese authorities’ approval to expand their investment in the world’s second-largest economy.
Based on a survey of more than 400 American companies, the business lobby group said American businesses “continue to perform well in China,” shrugging off the gloomy sentiment brought about by rising trade frictions between the two countries.
Is Tesla’s Shanghai plant announcement a matter of auspicious timing?
About 62 per cent of respondents expected to increase investment in China this year, up from 53 per cent businesses that added investment to the market in 2017.
“Uncertainty about US-China trade policy had a limited impact on investment and more companies are producing goods solely for the Chinese market,” AmCham Shanghai said in its 2018 China Business Report.
In Beijing, China’s Ministry of Commerce spokesman Gao Feng told a media briefing on Thursday that the mainland will continue to attract American investors.
“We hope US firms can do more to lobby the US government, and work hard to safeguard their own interest,” he said.
China’s response to the trade war can hit US technology industry where it hurts most
On Tuesday, the US has threatened to slap a 10 per cent tariff on a range of Chinese-made goods such as food and electronics, worth US$200 billion, in addition to duties imposed last Friday on U$50 billion of Chinese imports. Beijing has vowed to strike back.
Nearly 70 per cent of the respondents are against the retaliatory use of tariffs to achieve US 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. Trade punishment could be bargaining chip to gain wider market access in the mainland.
“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 support the overall trade policies.”
The bestselling US electric carmaker Tesla announced on Tuesday the establishment of its first overseas plant in Shanghai, with initial investment expected to hit US$10 billion.
The announcement followed Beijing’s move in April to scrap the 50 per cent foreign ownership limit for vehicles powered by alternative energy.
Manufacturing businesses continued to show improved performance for the third straight year in 2017. About 80 per cent manufacturers reported revenue growth in 2017, compared to 54 per cent in 2015 and 71 per cent in 2016, the survey said.
China’s digitalisation drive has resulted in huge demand for technology hardware, software and services companies with 85 per cent respondents in the sectors saying they will boost investment in 2018.
Aerospace and aviation sector also attracts American companies to raise their investment in China with 78 per cent of the respondents pledging to plough additional capital in the country this year.
Additional reporting by Amanda Lee
www.fotavgeia.blogspot.com
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