About 500 American companies operating in China say they are making a profit. But top-level officials with the companies say they increasingly feel unwelcome and targeted by the Chinese government.
The American Chamber of Commerce in China released the results of a survey of its members earlier this week. Fifty-seven percent of top-level managers said they feel Chinese officials are concerned about investigating foreign companies. The survey said that 47 percent of the officials felt unwelcome doing business in the country. That was an increase from 44 percent in the group’s report last year. However, most businesses asked -- 70 percent -- said they remain “profitable” or “very profitable.”
James Zimmerman is chairman of the American Chamber of Commerce in China, also known as AmCham China.
“People are making money. But there are always challenges. For the last 35 years there have been challenges. Anyone that says there was a time when there was no challenges or there was that golden era forgets that there has always been challenges here.”
In China, the investigation of foreign companies has become common since President Xi Jinping took power. Under his leadership, China has launched a campaign to improve food safety, and against official corruption. Chinese officials have examined the operations of Microsoft, Qualcomm, Audi, McDonald’s and other foreign companies.
James Zimmerman says he does not believe the government is targeting such companies on purpose.
AmCham China represents more than 1,000 U.S. businesses. Its representatives often meet with U.S. and Chinese officials.
Mr. Zimmerman has been working on China-related trade issues for more than 20 years. He says that he was personally involved in developing China’s Anti-Monopoly Law.
He says many of the cases against foreign companies were not raised first by the government.
It can be difficult for private companies to operate in China’s business environment. The companies have trouble competing against state-owned businesses. The country has experienced huge changes since it moved from a planned economy to one that is more market-driven. However, the state still has a strong influence in business.
The study found that 83 percent of those who gave answers noted concerns about the effects of Internet censorship on their business. Mr. Zimmerman says that companies are mainly concerned about how Internet controls can affect the flow of information. Those are things that affect everyone, he says.
“Those are things that affect me, that I find from time to time. But it seems to be more of an issue over the last six months where the Internet has slowed down or has been blocked in access to basic information has impacted on what I can do in my business.”
He adds that Internet censorship affects some businesses more than others. However, services industries that depend on information are among the hardest hit.
China’s economic slowdown
As China’s growth slows, a growing number of foreign companies say they do not plan to increase investment in the country.
The report notes that the percentage of companies that see China as one of several places in which to invest is increasing. In the new study, 27 percent of business said they consider China one of several places in which to invest. Nineteen percent said China is their top investment destination.
Words in This Story
targeted - adj. something that you are trying to achieve; something at which an attack is aimed
challenges - n. tests of ability or strength
monopoly - n. having complete control of the supply of goods or services in an area or market