US firms in China are largely optimistic about their prospects in the world’s second-biggest economy, a survey showed yesterday, despite a growth slowdown and a government austerity drive.
However, while the American Chamber of Commerce in Shanghai said 86 percent of its members were optimistic about the next five years, that figure is down from 91 percent in 2012, due to tough regulations and government probes.
About 74 percent of the firms surveyed said they were profitable last year, up from 73 percent in 2012, it said. Nearly 400 of the chamber’s members were polled.
“Despite optimism and growth, challenges in the business and regulatory environment in China continue to hinder business,” the 2013-2014 China Business Report said.
“Rising costs, HR [human resources] constraints, competition and an unclear regulatory environment are among the leading challenges that US companies faced in 2013,” it added.
Last year, China fined some foreign baby-milk producers and began a campaign against bribery in the pharmaceutical industry that mainly targeted overseas firms.
More than 18 percent of respondents said China’s more “aggressive” regulatory efforts increased their business risk last year, the chamber said.
The Shanghai free-trade zone set up last year brought optimism for economic reforms, but few US firms so far plan to establish a presence in it, the survey showed.
Nearly two-thirds of the US companies polled said the zone was a positive development, but only 15.8 percent are mulling establishing operations there.