American Companies Still Very Bullish on China; Many Plan Increased Investment

SHANGHAI, April 1 /PRNewswire-Asia/ -- More than three-quarters of American companies polled in a survey released today by the American Chamber of Commerce in Shanghai (AmCham Shanghai) say that the business environment in China has either improved or stayed the same over the past six months, calling into question recent media reports of a worsening business climate in China.

Among companies in China that have changed course over the past six months, a strong majority of them have chosen to increase their China investment, manufacturing operations, research and development, hiring, product development and procurement.

"We don't see a dramatic change in sentiment from our membership," said Brenda Foster, president of AmCham Shanghai. "Is China a challenging place to do business? Yes. It always has been and we will continue to work with the national government to develop a more competitive, open market in China. But our member companies remain committed to the China market and we're seeing many of them expand their operations here."

Among the 218 American companies surveyed by AmCham Shanghai, 65 percent report that their business performance has improved within the past six months despite steadily increasing competition in the China market.

"It is business as usual in China but the environment is becoming more competitive," said Pierre E. Cohade, president of Goodyear Asia Pacific. "With the business climate as positive as ever, the focus is now 'in China for China.' Successful companies need to continue to invest in building both capacity and capabilities and incorporate best global business practices to thrive in this market," he adds.

"At Owens Corning, we sell into the construction sector in China and we work very hard to understand our customer and to build effective sales channels," said James Lyon, director of business development for building materials at Owens Corning Asia Pacific. "While it is certainly challenging and takes a lot of effort, we have found success, more often than not, on the projects in which we chose to participate."

AmCham Shanghai recognizes that individual industries face different challenges in the China market. For example, the Chamber is particularly concerned about market access issues facing member companies in the IT and high-tech industry.

In the survey, AmCham Shanghai also asked members to comment on the recently announced indigenous innovation policy. Of the member companies aware of the policy, 30 percent reported that the directive would hurt their businesses.

AmCham Shanghai has communicated its strong concerns to the Chinese government on this issue and has asked the U.S. government to engage China on the indigenous innovation policy at the upcoming Strategic & Economic Dialogue meetings in May.

Despite these challenges, it is clear that American companies are committed to expanding their operations in China and that the China market continues to be a bright spot in their global operations.

This survey was conducted from March 24-31, 2010. Of the 218 participating American companies, 48 percent classified themselves as services companies, 46 percent as manufacturers and 6 percent as procurement.

About the American Chamber of Commerce in Shanghai

The American Chamber of Commerce in Shanghai, known as the "Voice of American Business" in China, is the largest and fastest growing American Chamber in the Asia Pacific region. Founded in 1915, AmCham Shanghai was the third American Chamber established outside the United States. As a non-profit, non-partisan business organization, AmCham Shanghai is committed to the principals of free trade, open markets, private enterprise and the unrestricted flow of information.

AmCham Shanghai's mission is to support the success of our members by promoting a healthy business environment in China, strengthening U.S.-China commercial ties and providing high-quality business information and resources.

Visit http://www.amcham-shanghai.org for more information about AmCham Shanghai.

SOURCE AmCham Shanghai