Companies gloomy over US-China relations but want tariffs to stay
- Two-thirds of US companies in China report trade war has affected their business strategies and operations
- AmCham finds ‘cautious pessimism’ dominates outlook for the next two years
Most US businesses in China say the trade war has affected their operations, but there is strong support for the current US tariffs on Chinese goods to remain in place while talks between Beijing and Washington continue, according to the American Chamber of Commerce in China.
A survey published by the Beijing-based business advocacy group on Tuesday found that 74 per cent of the more than 300 respondents believed ties between the major powers would deteriorate or stay the same this year, reflecting a “cautious pessimism” about the uncertainties of the ongoing trade war.
When questioned between mid-November and mid-December last year – at the time US President Donald Trump and Chinese President Xi Jinping were brokering their trade war ceasefire – more than two-thirds of companies reported the dispute was already affecting their business strategies and operations.
Despite the impact of the tariff war on business sentiment and operations, the chamber followed up on its broader survey with a short questionnaire last week, in which around 170 companies signalled broad support for not removing existing tariffs while trade negotiations remain ongoing.
The majority favoured keeping the 10 per cent tariffs on US$200 billion in Chinese goods or raising the amount to 25 per cent as scheduled on March 1, while talks between both sides continued.
While the 90-day ceasefire on escalation in tariffs was slated to end after March 1, Washington decided over the weekend to hold off on the move while the two sides planned for a summit between Trump and Xi to finalise a potential deal.