Over a quarter of American firms are prioritizing other countries over China, the American Chamber of Commerce in China (AmCham China) said, according to the Asia Times while also claiming that the sentiment regarding Sino-US relations is growing more pessimistic.
According to the AmCham China survey, 27 per cent of its members are considering countries other than China when making their investment decisions, mainly due to concerns about an uncertain policy environment in China.
The survey was conducted between April 18 and 20 and was published in the 2023 American Business in China White Paper on Wednesday.
Meanwhile, in the previous survey, the figure was just 6 per cent which was conducted last November and published in the 2023 China Business Climate Survey Report (BCS) last month.
In the latest survey, about 87 per cent of US firms expressed pessimism regarding the outlook for the relationship between the world’s two largest economies. The figure was 73 per cent in the 2023 BCS report.
The proportion of respondents who are optimistic about Sino-US relations fell from 8 per cent to 2 per cent for the same period. The remaining 11 per cent are neutral on the matter, reported Asia Times.
Talking about the latest survey, Chairman of AmCham China Colm Rafferty said that it was conducted against a backdrop of a tense US-China bilateral relationship that continues to stoke uncertainty in business decision-making while China is no longer the primary investment destination it once was.
Rafferty said members reported a slightly more pessimistic financial outlook for 2023 compared with previous years.
In the White Paper, AmCham China says the refusal of China to speak out against Russia’s 2022 invasion of Ukraine has further exacerbated tensions with the US and other Western nations as well as several of its neighbours.
“The Chinese government has repeated Russian propaganda and disinformation about the war, opposed economic sanctions against Russia and abstained or sided with Russia in United Nations votes on the war in Ukraine,” it said.
“These decisions have continually put China at odds with many the US and many Western nations, who have threatened sanctions should China offer military or financial aid to Russia,” it added.
It said that without a peaceful resolution, Beijing’s stance in the Ukrainian war will continue to raise concern among foreign companies invested in China, according to Asia Times.
US imports from Mexico, Vietnam, India and other “friend-shoring” venues depend on imports of Chinese components, according to an Asia Times study of international trade data.
James Crabtree, executive director of the Asia branch of the International Institute for Strategic Studies, says in a tweet that, because the West’s supply chains around the world will still need Chinese components, their fundamental vulnerability will remain.
Crabtree also says an economic decoupling between the West and China will leave Southeast Asian countries more economically dependent upon China. (ANI)