While China continues to remain one of the top priorities among U.S. companies, the country has lost some of its luster among some American executives. These are the findings released on Aug. 5 of an annual member survey of the U.S.-China Business Council (USBC).
According to the survey, 74% of the executives declared that China was either a top priority or among their top five priorities. However, that number reached 96% in 2013. Survey respondents attribute the priority dip to the frosty and tension-filled relationship currently between the U.S. and China. That worsening relationship and trade tensions continue to remain a major concern for the fourth year in a row.
Trade tensions, COVID-19
Conducted in June, the survey received responses from 107 company executives. Two-thirds of the companies have invested in China’s markets for more than two decades. Among the survey findings include:
- The COVID-19 pandemic and its travel restrictions ranked among the top challenges faced by U.S. companies. About 57% of survey respondents reported canceling business trips to China.
- Marking a first in the history of the survey, 45% of the executives cited that they felt pressure from consumers and both the U.S. and Chinese governments to publicly comment on political issues.
- Even though trade tensions and the pandemic were top concerns, U.S. companies reported solid profits and growth opportunities in China. A total of 95% of the companies declared they were profitable last year, while 64% experienced strong revenue growth.
- More than 40 percent of the 107 companies surveyed reported intentions to boost resource commitments in China next year.
A big sign of optimism for companies considering operations in China is that the majority of the surveyed companies continue to expect strong growth opportunities in serving the Chinese market. Those growth opportunities likely will top those in other emerging markets, according to survey results.