Trump has called on US firms to leave China, but no mass exodus among ‘well-rooted’ companies
- The American Chamber of Commerce Shanghai’s annual member survey shows US firms are adapting to the volatile geopolitical situation
- While few are planning to leave China, a third have found it difficult to retain Chinese staff due to the US-China tensions
For American companies in China, the meltdown of bilateral relations represents the biggest concern in 2020, but few businesses invested in the country long-term are inclined to leave while enjoying healthy profits in an economy that has rebounded strongly from the coronavirus pandemic.
Almost two-thirds of respondents to the American Chamber of Commerce in Shanghai’s annual business survey said US-China tensions were their biggest worry – the first time bilateral issues have led the poll, and well ahead of the second biggest concern, domestic competition, on 58 per cent.
“Under my administration, we will make America into the manufacturing superpower of the world and we’ll end our reliance on China, once and for all, whether it’s decoupling or putting in massive tariffs like I’ve been doing already,” US President Donald Trump said in a Labour Day address in which economically separating from China featured prominently.
Our biggest concern is to understand what the White House’s goals are and where we are headed
Only 4.3 per cent of AmCham’s members plan to move parts of their operations back to the United States, the fourth most popular destination for diversifying supply chains, with 70.6 per cent of businesses planning no change in production allocation, up 5.1 per cent on last year.
The profile of the members surveyed suggests that these are not short-term players in China looking for manufacturing arbitrage.