Asia: Business

Businesses move China down priority list: AmCham survey

No more business as usual: AmCham China
No more business as usual: AmCham China

China is becoming less of an investment priority for companies, with 56 percent of those in an American Chamber of Commerce survey placing the world's second largest economy on the top three spots on their priority list, down from the peak of 78 percent in 2012.

This comes as the companies highlighted five areas of concern covering opaque rules and laws, higher labor costs, Chinese protectionism, finding suitable management talent and difficulty getting licenses to operate, the annual survey of 462 companies released Wednesday revealed.

It found about a quarter of these companies are also either slowing down or pulling out of China as they brace for the third year of slowdown.

The non-profit organization also found that 83 percent of the companies think relations between the U.S. and China will deteriorate or remain the same this year.

About 80 percent said they felt less welcome than before, up from 77 percent the previous year.

Commenting on the survey, AmCham China's chairman William Zarit told CNBC's Squawk Box that 2017 will not be business as usual between the two economic giants.

"There is a sense that the Western countries, including the U.S., have been (very) open to the Chinese exports, to Chinese investments...which has helped the Chinese in the last 30 years with their incredible growth. However we don't see that we have the same open opportunities in China, whether it's in trade or in investments," Zarit said.

It will not be business as usual in 2017, an American Chamber of Commerce in China survey indicated.
Greg Baker | AFP | Getty Images

Trade between the U.S. and China is in sharp focus with President-elect Donald Trump vowing to change policies to support workers displaced by outsourcing and automation, said Zarit.

That aim was reflected in comments by a member of Trump's transition team on the sidelines of the World Economic Forum (WEF) in Davos, Switzerland saying the U.S. does not want a trade war, but just a better deal with China.

American financier Anthony Scaramucci — soon to be an assistant to Trump in the office for public liaison — said China and the U.S. have a "common cause."

"I believe that the U.S. and the new administration does not want to have a trade war," he said at the event. "(We) want to have free and fair trade," he added.

The remarks also come as Chinese President Xi Jinping said Tuesday at Davos that globalization has powered worldwide growth and should not be blamed for the world's problems.

"It is true that economic globalization created new problems, but this is no justification to write off economic globalization altogether. Rather we should adapt to and guide economic globalization,cushion its negative impacts and deliver its benefits for all countries."

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