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The Stream - Tuesday January 17, 2017
by JOE McDONALD
BEIJING (AP) -- U.S. companies feel less welcome in China and some are shifting operations to other countries, a business group reported Wednesday, amid rising tension between President-elect Donald Trump and Beijing over trade.
The report by the American Chamber of Commerce in China reflects frustration among companies that see China as a key market but face growing efforts to block access to technology and other promising industries.
It comes ahead of the Friday inauguration of Trump, who has promised to raise tariffs on Chinese goods and declare Beijing a currency manipulator, moving toward imposing sanctions.
Communist leaders have promised to make China’s state-dominated economy more productive by opening more industries to private and foreign competitors. Business groups say such initiatives have had little impact.
The American chamber said 81 percent of companies that responded to a survey feel “less welcome in China,” up from 77 percent last year. It said 60 percent have little or no confidence Beijing is committed to opening markets further in the next three years.
One in four companies moved operations out of China in the past three years or plans to do so, the chamber said. They cited regulations, rising labor costs and other strategic priorities.
“Most respondents say China’s environment now discourages investment,” the report said.
Foreign companies complain Beijing is reducing access to its markets for electric cars, computer security technology and other promising fields or pressing them to give know-how to potential Chinese competitors.
Beijing also faces U.S. and European complaints it is exporting steel, aluminum, solar panels and other goods at improperly low prices, threatening thousands of jobs abroad.
The American chamber made no mention of Trump but said the share of companies that believe positive U.S.-Chinese relations are “critical to their business success” rose to 72 percent from last year’s 64 percent.
Some 83 percent expect ties “to remain the same or to deteriorate in 2017,” the report said.
“The big question for many member companies as 2017 dawns is how the bilateral relationship may affect their business and what steps both governments will take to ensure a positive business environment.”
European companies complain they are blocked from acquiring assets in China at a time when Chinese companies have bought leading brands including German robot maker Kuka in a multibillion-dollar acquisition spree.
On Tuesday, German Ambassador Michael Clauss called on Chinese leaders to make good on promises to open wider to foreign investment and give foreign companies a “level playing field.”
“Many companies keep telling us that their difficulties in these areas have increased,” said Clauss in a statement. “It often appears that somewhere down the line, political assurances of equal treatment give way to protectionist tendencies.”
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American Chamber of Commerce in China: www.amchamchina.org.
Copyright 2017 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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