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APD | US firms do not intend to leave China



By APD writer Alice

American companies were concerned about the growing tension between the US and China, but showed no intention to exit the Chinese market, according to US media.

In its article titled "Deteriorating relations with China put US companies on edge",  The Hill said that the US business community is worrying about the China-smearing remarks of US officials, and wary of statements that are believed to lessen the optimism of businesses in China.

US officials are putting public pressure on several high-profile companies by characterizing competition between the two countries as an ideological battle for the future of the free world. In doing so, they have pointedly attacked American companies doing business with China.

If the Trump administration’s goal is for US companies to exit the Chinese market, ramped up rhetoric is starting to have the intended effect by souring the optimism of American businesses operating there.


Shaun Rein, founder of China Market Research Group, said in general, US companies do not agree with the US administration’s views on China.

“They make a lot of money here, they don’t want to leave. The only time they want to leave is to duplicate supply chains,” he noted.

Doug Barry, Communications Director of the US and China Business Council, which represents about 220 companies operating in China, said that they want the two sides to work together to resolve disagreements peacefully. To do this, the US government needs a comprehensive and clever long-term policy which is expected to play an important role in developing relations between the two countries.

The signing of the first phase of the trade deal between China and the US in January 2020 received the applause of the business community. It is regarded as a positive step to improve bilateral ties.


The COVID-19 pandemic and its impacts on the US economy have prompted some businesses to look for additional supply chains elsewhere. However, according to The Hill, US companies still hope that Washington and Beijing will find a ways to patch things up. 

Meanwhile, UBS Group AG predicted that China's economy will grow by 2.5% this year, higher than the 1.5% forecast it made earlier thanks to the recovery of domestic consumption and strong investment.

The positive projection will be a foundation for companies, especially those from the US, to decide whether they leave the Chinese market or not.


Compared to predictions of minus growth in many other countries worldwide, the 2.5% forecast for China really consolidate firms’ confidence in staying the country.

Previously in March, a survey jointly conducted by the American Chamber of Commerce in Beijing and Shanghai and auditing firm PricewaterhouseCoopers showed that the majority of US companies had no plans to relocate from China or switch suppliers from the country despite the ravaging coronavirus outbreak at the time.

Over 70% of surveyed companies said they expected their supply chains in China to recover in three months, and 96% said the recovery would take place in 3 to 6 months.


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