Despite heightened tensions impacting China-US relations and the US' push toward "decoupling" from China, nearly 70 percent of US companies operating in China expect revenue growth in the market to outpace their worldwide growth over the next three to five years, according to a new report released by the American Chamber Commerce (AmCham) in Shanghai on Thursday.
China-US (Photo:Xinhua)
American businesses in China bounced back quickly from the 2020 COVID-19-induced shutdown, and most companies are optimistic about profits and investing more to take advantage of China's anticipated future growth, the 2021 China Business Report revealed.
Of the 338 respondents surveyed, 77.9 percent of US companies described themselves as either optimistic or slightly optimistic about the five-year business outlook, a return to the figures observed before the most brittle days of the China-US trade war, according to the report.
Meanwhile, the report also found out that the speculation that some US companies might move production or supply chains out of China in the aftermath of COVID-19 was largely unfounded.
Of the 125 respondents that said they manufacture in China, 72 percent have no plans to move any production out of China in the next three years, while no companies are relocating their production from China to the US.
"Business in China recovered quickly from last year's lockdown. However, we are still feeling the pandemic's effects, with members continuing to be negatively impacted by China's travel restrictions," said Ker Gibbs, president of AmCham Shanghai. "Overall business performance is good but there are signs of nervousness. The regulatory environment on both sides is tightening, which narrows the space in which companies can operate."
Having a China strategy is still a priority for many of the US companies in China that are optimistic about the future in China, said Jeff Yuan, PwC China US MNC Business Services Group, Lead Partner. "With the projected increase in investment during 2021, we anticipate an increased focus on reaching Chinese consumers by prioritizing investments in sales & marketing and digital technologies."