U.S. lobby says China
protectionism fueling foreign business pessimism
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[January 18, 2017]
By Michael Martina
(Reuters) - 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 China's President Xi Jinping gave
a speech at the World Economic Forum championing open markets, and
Beijing unveiled proposals to reduce restrictions on foreign investment
Business circles are particularly concerned over the future of
U.S.-China commercial ties as President-elect 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 deprioritizing 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.
Asked about the report, Chinese Foreign Ministry spokeswoman Hua
Chunying said investment figures showed China remained an attractive
place for U.S. businesses and China was committed to opening up.
"At the same time, we hope that the doors of all countries are fairly
opened to Chinese investors," Hua told a daily news briefing.
LACK OF CONFIDENCE
The chamber 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, 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.
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A U.S. flag is tweaked ahead of a news conference between U.S.
Secretary of State John Kerry and Chinese Foreign Minister Wang Yi
at the Ministry of Foreign Affairs in Beijing, Wednesday, Jan. 27,
2016. REUTERS/Jacquelyn Martin/Pool
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 President Xi's speech at the World Economic Forum 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 February, months ahead of an annual lobbying trip, to engage with the Trump
"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
(Additional reporting by Ben Blanchard; Editing by Robert Birsel)
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