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Here’s why more and more American companies are leaving China

The number of respondents reporting the impact of Covid restrictions rose 4 percentage points to 58 percent between late March and late April, according to a study released Monday by the American Chamber of Commerce in China.

Foreign investment in China is expected to decline dramatically over the next few years, according to AmCham China President Michael Hart, as people cannot easily access the country and develop projects. According to a recent study, 53% of respondents said they would limit investment in China if Covid regulations continued next year. As the Covid restrictions drag on, more and more US firms in China are lowering their sales forecasts and plans for future investments.

While not a significant increase, AmCham President Michael Hart said 4 or 5 percentage points per month could be “quite significant” if Covid limits are maintained for another five months.

Investment from China

When asked what the impact of Covid restrictions would be if they continued for a year, more than 70% of respondents said they would lose income or profit. The latest survey, which took place between April 29 and May 5, examined 121 companies with offices in China. The latest Covid restrictions in Beijing were imposed within this time. I foresee a significant drop in investment in China in two, three, four years as no new projects are planned and people can’t come in and look at space. The latest study was conducted with AmCham Shanghai in late March, just as Shanghai’s original plan for a two-part lockdown was launched. These restrictions exist much longer than in the first week.

Beijing has ordered all non-essential businesses in a key trade hub to temporarily close or let their employees work from home in the past few days and postponed the school’s reopening until further notice. “Few elements of the economy appear to be working,” said one respondent in the study, which did not reveal the respondent’s name or region.

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https://www.financebrokerage.com/hamerican-firms-leaving-china/ Here’s why more and more American companies are leaving China

Callan Tansill

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