When a U.S. company is doing business in or investing in China, many different types of conditions within China could have impacts on its efforts.
This includes overall economic conditions in the country. Recently, China announced a growth forecast for this year. It is forecasting that the country will see a decline in its growth rate in 2017.
Specifically, China announced a target growth rate for this year of 6.5 percent. This would be a lower rate than the one from 2016, as the growth rate came in at 6.7 percent that year. It would also be the lowest growth rate that China has had since the early 90s.
If things follow this forecast and the growth rate does go down a little in China this year, one wonders what impacts it will have for the investment and business prospects of U.S. companies that have dealings in China.
Another thing that can have significant ramifications for U.S. businesses that have China dealings are the legal conditions in China for foreign companies. This can include what laws, rules and policies are present when it comes to foreign company access to China. Recently, China’s premier made a statement when it comes to such access. He said that China will aim to give foreign companies improved access to China. One wonders what efforts on this front will ultimately be taken and what such efforts will ultimately mean for U.S. companies looking to operate or invest in China.
It will be interesting to see what conditions end up being like for U.S. businesses in China in 2017.
Now, what impacts conditions in China have on a given U.S. business that operates in China (or is starting such operations) depends heavily on the specifics of the company and its Chinese operations. So, when a company is deciding how to respond to such conditions, legal guidance well-tailored to its circumstances could be a very helpful thing for it to have.
Source: USA Today, “China reduces growth forecast for 2017 to 6.5%,” Mike Snider, March 5, 2017