US firms turn up­beat on China af­ter Bi­den win, Am­cham says


Just over half of Amer­i­can com­pa­nies are more op­ti­mistic about do­ing busi­ness in China on ex­pec­ta­tions of bet­ter trade re­la­tions with the US un­der a Bi­den ad­min­is­tra­tion, ac­cord­ing to a sur­vey from the Amer­i­can Cham­ber of Com­merce (Am­cham) in Shang­hai.

“Com­pa­nies broadly view the prospect of a Bi­den ad­min­is­tra­tion fa­vor­ably,” the trade lobby said in a statement, cit­ing the re­sult of a sur­vey of 124 Amer­i­can com­pa­nies. “This may be due to ex­pec­ta­tions that the US-China re­la­tion­ship will be­come more sta­ble than it was the past four years, though it is un­likely to re­turn to the pre-2016 par­a­digm.”

The sur­vey, con­ducted from Novem­ber 11 to 15, showed 54.8 per­cent of the re­spon­dents have be­come more up­beat about their busi­ness prospects in China, while only two com­pa­nies said they are more pes­simistic. Nearly 57 per­cent of re­spon­dents do not ex­pect trade re­stric­tions or tar­iffs to in­crease, ac­cord­ing to the sur­vey.

It re­mains un­clear whether Pres­i­dent- elect Joe Bi­den will aim to counter China’s rise as ro­bustly as Don­ald Trump did in the last four years. On the cam­paign trail Bi­den stopped short of specifics on which parts of the Trump- era China poli­cies he would change, though he also crit­i­cized Bei­jing for its ac­tions in Hong Kong and Xin­jiang.

De­spite the un­cer­tainty, US man­u­fac­tur­ers in China have no in­ten­tion of pulling out. Some 82 per­cent of busi­nesses have no plans to off­shore their man­u­fac­tur­ing in the next three years. One com­pany in­tends to move all of its pro­duc­tion off­shore, while two an­tic­i­pate mov­ing more than 30 per­cent off­shore.

Man­agers of some Chi­nese man­u­fac­tur­ers in­ter­viewed by Bloomberg early this month said they are wor­ried the US un­der Bi­den will re­main hos­tile to­ward the na­tion. US tar­iffs on bil­lions of dol­lars worth of Chi­nese goods will be re­tained, as will strict re­stric­tions on tech­nol­ogy and in­vest­ment, they said.

The fol­low­ing is a key sum­mary of the Am­cham sur­vey:

▪ 54.8 per­cent said they are more op­ti­mistic about do­ing busi­ness in China; 35.5 per­cent see no change; 8.1 per­cent are much more op­ti­mistic, while only 1.6 per­cent (or two com­pa­nies) said their think­ing about do­ing busi­ness in China was now more pes­simistic

▪ Asked about in­vest­ment, or de­risk­ing plans un­der a Bi­den ad­min­is­tra­tion, 53.2 per­cent of com­pa­nies ex­pect no change in their in­vest­ment plans, 13.7 per­cent ex­pect an in­crease, and just 5.6 per­cent will “com­mence, con­tinue, or con­sider a China de-risk­ing strat­egy”

▪ Com­pa­nies are more op­ti­mistic now about their ex­pected 2020 rev­enue out­come com­pared to July, with 47.6 per­cent of re­spon­dents ex­pect­ing an in­crease over 2019 re­sults

▪ 29.8 per­cent of re­spon­dents be­lieve that US- China trade ten­sions will con­tinue in­def­i­nitely, ver­sus the 26.9 per­cent who agreed with this statement in a sep­a­rate sur­vey of Chi­nese busi­nesses by the cham­ber.

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