US firms in China say vague rules, tensions with Washington, hurting business, survey shows

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An American Chamber of Commerce survey shows American companies operating in China view tensions with Washington over technology, trade and other issues as a major competitive obstacle for their businesses there.

Such disruptions were a major “push factor” that companies cited in expanding their operations outside China, the survey showed.

Companies face a growing threat from “nimble, innovative local businesses and state-owned enterprises, which have enjoyed stronger support in recent years and whose consolidation has made them increasingly competitive with large multinational corporations,” the survey said. Southeast Asia ranked as the top choice for the 40% of companies shifting their investments to places outside China, followed by the U.S. and Mexico, the survey said.

“Companies are much more hesitant,” said Sean Stein, AmCham Shanghai’s chairman. He noted that the problem was acute for financial and pharmaceutical companies. Foreign investment into China fell 2.7% from a year earlier in the first half of 2023, according to official data.

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