Rogue Nation

US business group urges Washington to 'use every arrow' against China

Reuters

The United States should "use every arrow" in its quiver to ensure a level commercial playing field in China, a U.S. business lobby said on Tuesday, warning that 2017 could be the toughest year in decades for American firms in the country.
China's policies designed to support domestic companies and create national champions have narrowed the space for foreign companies, the American Chamber of Commerce in China said in its annual business climate report.
The White House has said U.S and Chinese officials are fleshing out a pledge by Donald Trump and Xi Jinping for a 100-day plan to cut the U.S. trade deficit with China, which reached $347 billion last year.
But the chamber said it hoped more attention would be paid to market access for American firms in China.
"Right now basically we are recommending everything you have in your quiver -- please use every arrow possible," chamber chairman William Zarit said, referring to possible backlash from Beijing.
He was speaking at a briefing on the report.
U.S. business groups want U.S. officials to take measures against Beijing on market imbalances.
More vociferous complaints from the American business community mark a shift from years past, when many companies eschewed the idea of forceful action by Washington for fear of retribution by China.
Foreign technology companies, in particular, fear what they see as Beijing's plans to pump billions of dollars in subsidies into domestic competitors and push regulations that could force the surrender of key technology or hit competitiveness.
"With uncertainty stemming from political and economic transitions in both the U.S. and China, perceptions of a deteriorating investment environment for foreign companies in China, and a slowing economy, 2017 will likely be one of the most challenging years in decades for U.S. companies in China," the chamber said in its report.
U.S. business leaders also worry that Trump's focus on curtailing North Korea's nuclear and missile programmes could undercut U.S. commercial interests in China. 

Last week, Trump tweeted that Beijing would get a better trade deal if it helped resolve the U.S. problem with Pyongyang.
"I'm sorry to see there is a possibility we may lose some momentum on helping to level the playing field with China in our economic relationship, due to the situation in North Korea, if there is some kind of trade-off," Zarit said.

American Chamber of Commerce in China: "Chinese protectionism fuelling foreign business pessimism"

More companies are slowing investments and deprioritising China as an investment destination due to slowing growth and increased concerns over barriers to market entry, the regulatory environment, and rising costs

By Michael Martina

BEIJING -- More than 80 percent of members of a U.S. business lobby in China say foreign companies are less welcome than in the past, a survey released on Wednesday showed, with most saying they have little confidence in China's vows to open its markets.
The American Chamber of Commerce in China's annual survey reinforces growing pessimism in the foreign business community, as it grapples with a slowing Chinese economy and complains of increasing protectionism.
The chamber's report comes a day after  Xi Jinping gave a speech at the World Economic Forum (WEF) championing open markets, and Beijing unveiled proposals to reduce restrictions on foreign investment in China.
Business circles are particularly concerned over the future of U.S.-China commercial ties as President Donald Trump prepares to take office, having pledged to brand China a currency manipulator and threatened to impose tariffs on its goods.
"More companies are slowing investments and deprioritising China as an investment destination due to slowing growth and increased concerns over barriers to market entry, the regulatory environment, and rising costs," the chamber said.
If China took action, including removing "discriminatory barriers" to foreign-invested companies and investment restrictions, the chamber's members would "significantly increase investment", it said.
The share of companies that identified China as a top three global investment priority dropped to 56 percent this year, compared with a peak of 78 percent in 2012, the chamber said, calling it a record low.
Eighty-one percent of the 462 companies included in the survey, among them U.S. and multinational firms, said foreign business was less welcome in China than in the past, up from 77 percent in 2016.
Foreign businesses in China, as well as foreign governments, have long complained about a lack of market access in China and restrictive policies that run counter to its pledges to free up markets.
Though Eleven's speech at the WEF in Davos painted a picture of China as a "wide open" economy, more than 60 percent of the chamber's members had "little or no confidence that the government is committed to opening China's markets further in the next three years".
Respondents estimated on average that China's economic growth for 2017 would be 6.1 percent, below what sources have told Reuters would be a government target of around 6.5 percent.
The survey, with responses compiled both during and after Trump's November election victory, showed 72 percent of members felt that positive U.S.-China relations were "critical" to business, but only 17 percent thought they would improve in 2017.
Chamber chairman William Zarit said some of its members would go to Washington in early February, months ahead of an annual lobbying trip, to engage with the Trump administration.
"We certainly are not going there to lecture the administration, but we are there to share our ideas on ... a more constructive path forward," Zarit said at a briefing on the survey.
China has warned that it will be tough for its foreign trade to improve this year, especially if a Trump administration and other political changes limit export growth.