American firms in China fearful of US-China trade turmoil at 5-year high, survey shows

A recent survey by the American Chamber of Commerce (AmCham) in China highlights growing concerns among U.S. businesses about the future of U.S.-China relations. For the first time in five years, over half of respondents (51%) expressed worries about further deterioration in the bilateral relationship between the world's two largest economies. This concern arises amid escalating geopolitical tensions, policy uncertainties, and trade disputes.

The survey, conducted among 368 member companies between October and November last year, came after Donald Trump secured a second term as U.S. president. During his first term, U.S.-China relations were marked by a trade war and heightened diplomatic tensions, a trend that did not significantly improve under President Joe Biden. Trump's recent remarks about potentially imposing a 10% tariff on Chinese imports related to fentanyl supply chain issues have further fueled uncertainty.

Despite these challenges, nearly half of the respondents still consider China a top-three global investment destination, consistent with previous years. However, the number of businesses no longer viewing China as a preferred investment destination has more than doubled to 21% compared to pre-pandemic levels. This represents a three-percentage-point increase from the previous year.

Additionally, around a third of U.S. firms continue to report unfair treatment in China, particularly regarding market access and public procurement. These issues highlight the ongoing challenges foreign businesses face in navigating China's regulatory environment.

AmCham China Chair Alvin Liu underscored the importance of a "stable and constructive relationship" between the two nations, emphasizing that such ties are essential not only for their mutual prosperity but also for global economic stability. However, with trade tensions persisting and geopolitical risks on the rise, the outlook remains uncertain for U.S. businesses operating in China.