US firms consider China market critical despite fraying relations, other issues, survey says

South China Morning Post

a day ago

A new survey of American companies operating in China indicated that most of them consider the country's market critical despite fraying bilateral relations, tariffs, economic weakness and lost market share.
Nearly all respondents participating in an annual US-China Business Council survey said they cannot remain globally competitive without their business in the world's second-largest economy, according to a report about the survey published by the advocacy group on Wednesday.
This is despite the fact that a growing number of US firms report dropping sales, reputational damage and pressure on profitability in the face of growing geopolitical tensions and trade issues and stricter investment restrictions.
Moreover, although leaving China is not viable for many American firms, the group said that fewer than half of survey respondents are optimistic about the future, given persistent concerns over tariffs, China's deflation and insufficient demand and policy uncertainty.
The survey covered about 130 of the group's 270 member firms, most of which are large corporations that have been in China for over 20 years, and was conducted between March and May.
Sean Stein, the trade group's president, in an interview with the Post called for current bilateral trade talks to address issues other than just tariffs and export controls.
'Now it feels like all of the negotiation oxygen is being taken up by tariffs and export controls … What we need to make sure is if both sides actually do want to have robust American investment in China,' he said.