• Landmark 25th edition of annual report contains assessment of current operating environment and provides comprehensive list of recommendations for both governments.
  • Separate Flash Survey results show improved business outlook, but highlight bilateral tensions as a growing concern.

Beijing, April 26, 2023 – The American Chamber of Commerce in China (AmCham China) today releases the landmark 25th edition of the American Business in China White Paper (White Paper), which lays out in detail a number of policy recommendations – both cross-sector and industry-specific – for the Chinese and US governments. This year’s edition contains 40 chapters covering developments over the past year, and includes 20 chapters on industry-specific issues, such as agriculture, banking, ICT, manufacturing, healthcare, and real estate, 11 chapters on industrial policy and market access, such as competition law, compliance, procurement, and taxes, and five chapters with a region-specific focus, covering central China, northeast China, southwest China, Shanghai, and Tianjin.

Some of the key themes in this year’s White Paper, which was drafted by hundreds of member-company representatives, include:

  • The impact of the past three years of COVID-Zero is still being felt across many industries, despite the removal of COVID prevention measures and travel restrictions.
  • A lack of confidence in the bilateral relationship has increased the level of concern regarding US investment in China and overall risk exposure.
  • The government-led emphasis on self-reliance is creating additional uncertainty for foreign businesses.
  • Member companies are still committed to the China market, but many longstanding business challenges remain.

“This release of our 25th annual American Business in China White Paper is an important milestone in AmCham China’s history,” said AmCham China Chairman, Colm Rafferty. “This signature policy document has been used as a key channel for our member companies to share their insights with both the US and Chinese governments for the past quarter-century. In this landmark edition, we continue AmCham China’s practice of offering a comprehensive set of constructive recommendations for both governments, as they work towards greater mutual understanding and successful resolution of outstanding company concerns.”

In addition to outlining challenges and recommendations, the White Paper expands upon the Chamber’s three Policy Priorities for 2023. They are:
1. Maintain channels for commercial engagement and meaningful exchange while separately addressing national security concerns and values-based differences.
2. Advocate for clear and consistent policies at all levels of government along with transparent policy implementation directives and intentions.
3. Expand market access for foreign-invested enterprises through continued efforts to address ongoing concerns such as non-tariff barriers, the negative list, procurement restrictions, and unfair treatment in favor of SOEs and domestic companies.

A separate Flash Survey, which was designed as a follow-up assessment to the 2023 China Business Climate Survey Report (2023 BCS), was also released today by AmCham China, and presented the latest business sentiment for American companies in China. Member companies’ most recent views on China’s two-year business outlook were more optimistic compared to the 2023 BCS results. This was especially true in China’s economic recovery, where 59% of members reported a positive outlook, a 22 percentage points (pp) increase compared to the 2023 BCS results (33%). 59% of members also expressed positive views on China’s domestic market growth, up from 42%, although the number of those who were optimistic about the potential for profitability only rose slightly, up 4pp to 37%.

Among the most pressing concerns currently on the minds of member companies is the challenge presented by deteriorating US-China relations, with pessimistic sentiment growing in recent months. Views on the bilateral relationship worsened, rising from 73% who expressed a pessimistic outlook for US-China relations in the 2023 BCS survey results to 87% in this Flash Survey. Elsewhere, nearly half (48%) of members said they expected their industry to grow this year, while 15% reported uncertainties. 20% of Consumer sector respondents said they predict industry growth of 20% or more in 2023, up sharply from the 2023 BCS, but respondents in the other three main sector groups – Resources & Industrial, Technology and Other R&D-intensive Industries, and Services – predicted very similar levels of growth compared with the previous survey. Meanwhile, 40% of members said they have no change in their short-to-mid-term (2023-25) China investment plans, while another 24% said they plan to increase investment in China at different levels.

The survey also found that the majority of members (73%) are not moving their supply chains outside of China, while another 23% are either considering or already starting the relocation process. Risk management is the top reason given for those considering relocation, as reported by 44% of the respondents. Additionally, 27% of the respondents reported that their companies had re-prioritized other countries, a 21pp increase from the 2023 BCS results.

Meanwhile, 51% of companies said foreign expats showed interest in relocating or returning to China. 68% of members cited bilateral tensions and other geopolitical risk factors as the top issue for foreign expats to consider when deciding whether to accept China assignments. The lack of sufficient international flights was also a main concern, cited by 44% of members.

In a sign that China is starting to see increased engagement with executives from around the world, 43% of respondents reported their global or regional executives have already visited China since December 2022. Another 31% of members reported their global or regional executives will visit China in the coming months. The Flash Survey was conducted from April 18-20, drawing responses from 109 companies with operations throughout China.

About AmCham China – US-China Business: The Next 100 Years

Founded in 1919, the American Chamber of Commerce in the People’s Republic of China (AmCham China) is a non-profit, non-governmental organization representing nearly 1,000 companies operating across China. The Chamber’s nationwide mission is to help American companies succeed in China through advocacy, networking, insights, and business support services. In addition to our headquarters in Beijing, AmCham China serves Tianjin, Central China, and Northeast China through our Chapters in Tianjin, Dalian, Shenyang, Wuhan and Chengdu. Across those locations, AmCham China has more than 30 working groups, and holds more than 200 events each year. Visit the Chamber’s website at www.amchamchina.org

For more information, please contact: Mark Dreyer, Marketing & Communications Senior Director, AmCham China: mdreyer@amchamchina.org