Caixin
Caixin Global – Latest China News & Headlines

Home >

ABOUT US

CX Tech is Caixin Global's real-time tech news portal, featuring 24-hour news, short-form analysis, and roundups from business and tech media in China.

LATEST
Trending in China: Death of Giant Panda Cubs Sparks Concerns About Treatment of ‘National Treasure’
China CFO of Indian Oyo Quits to ‘Pursue Other Professional Opportunities’
Sequoia Capital Opens Its First Tech Incubation Center in Shanghai
Some 266 Foreign-Invested Firms Approved to Offer Telecom Services in China in First Half of 2020
Trending in China: Should Internet Celebrities Be Part of the School Curriculum?
Sequoia China Leads Nearly $100m Round in Storytelling App Kuaidian
Medical Robot Maker Finds Elixir in STAR Board’s Market Reforms
Trending in China: Outrage Ensues as Updated U.S. Student Visa Policies Force International Students into a Dilemma
Tencent’s PUBG Mobile Game Hits $3 Billion Milestone
Luckin Coffee Shareholders Vote to Remove Chairman, Bloomberg Reports
France Won’t Ban But Will Discourage Use of Huawei 5G Equipment, Official Says
Trending in China: ‘Lipstick King’ Li Jiaqi Settles in Shanghai, Prompting a Rethink of ‘Talent’
Tencent Plays in U.S. With California Game Studio Launch
Trending in China: Shenzhen Thinks Only Children Should Get Paid Leave to Look After Their Parents - Cue Heated Debate
German Drugmaker BI Launches Shanghai Center to Harness Chinese Expertise
Chinese Self-Driving Truck Firm Aims to Cover Most of U.S. by 2024
Trending in China: Chinese Netizens Tell Indian Prime Minister Modi To ‘Shut The Door On The Way Out’ As He Quits Weibo
Trending in China: If You Can’t Beat Them, Join Them – Why Tencent is Laughing At Itself
Meituan Eyes Robot-Enabled Deliveries with $14 Million Investment in PuduTech
India Ban Could Hit TikTok’s Parent Company to the Tune of $6 Billion
U.S. Firms More Pessimistic on China Due to Trade War, Slowdown

By Bloomberg / Feb 26, 2019 10:27 AM / Business & Tech

Photo: Bloomberg

Photo: Bloomberg

Many American companies are tempering their investment plan in China due to concerns about slower economic growth and the trade war, with their outlook shifting to "cautious pessimism" from "cautious optimism," according to the latest survey conducted by the American Chamber of Commerce.

Firms still see the Chinese market as a high priority, but nearly three-quarters expect China-U.S. relations to deteriorate or stay the same, at best, in 2019. However, companies in all sectors still see China as a top priority in their near-term global investment plans because of moderate growth and the "rise of an increasingly sizeable and affluent middle class."

Key Insights

U.S. companies rank "bilateral tensions" as a top challenge for business in China, just behind long-standing issues such as rising labor costs and inconsistent policy interpretation and uneven enforcement. As many as 65 percent of the respondents said trade tensions are influencing their longer-term strategies, and about 25 percent are delaying extra investments in China. Some companies have a "wait and see" attitude, while a growing number of firms are mitigating risks through making contingency plans, diversifying supply chain and delaying investment. U.S. companies continue to highlight concerns over market access restrictions and opaque regulation, especially in technology and other research-intensive industries. One third of respondents limit investment in China because of intellectual property protection concerns, though the majority acknowledge China’s efforts to improve the IPR laws and enforcement, especially regarding trademark and brand protection. About 50 percent of respondents are optimistic that China will open markets further for foreign businesses.

If the U.S. can force China to further open its markets to foreign products and investors in the ongoing talks, U.S. companies invested in the country stand to benefit. However, the trade war has already damaged them, as it has damaged companies and farmers at home that do business with China. According to the report, U.S. firms said tariffs generated higher manufacturing costs, lowered customer demand and put pressure on profitability.

Related: Full coverage of the U.S.-China trade war

Support independent journalism from China. Subscribe to Caixin Global starting at $0.99.

Share this article
Open WeChat and scan the QR code