BEIJING — U.S. companies are planning their lowest rate of expansion in China since 2016 in response to growing uncertainty about U.S.-China relations and a slowing Chinese economy, according to a survey by the American Chamber of Commerce in China.
About 32% of 314 U.S. companies that responded to the survey said they have no plans to expand investment in China or plan to expand less this year, compared with 26% last year, according to the survey released Monday. Companies that have moved capacity outside of China or are considering doing so cited U.S. tariffs on products exported from China as their chief concern, along with rising costs and slower economic growth.
“If you have to make the investment now, then you may decide to invest in a third country,” said Timothy P. Stratford, Amcham China chairman and lawyer at Covington & Burlington LLP in Beijing. “And if you can delay, then you’ll try to delay.”
The annual survey was conducted between Nov. 13 and Dec. 16, a time of seesawing tensions in the U.S.-China trade fight, in which both sides have slapped punitive tariffs on goods making up about 60% of their trade. The survey’s findings broadly line up with criticisms from U.S. and other foreign firms in recent years that business conditions in China are getting tougher, with government regulations and policies favoring domestic firms.
An expanded version of this report appears on WSJ.com.
Also popular on WSJ.com:
FBI’s most wanted: More applicants for special agents.
Your avocados and olives are pricier because fat is in fashion.
Want news about Asia delivered to your inbox? Subscribe to MarketWatch's free Asia Daily newsletter. Sign up here.
