logo
Daunted by geopolitics, trade war, US companies in China report record-low new investment plans

Daunted by geopolitics, trade war, US companies in China report record-low new investment plans

Mint17-07-2025
Washington, American companies in China are reporting record-low new investment plans for this year and declining confidence in their profitability, with uncertainty in US-China relations and President Donald Trump's tariffs their top concerns, according to a new survey.
The companies are also challenged by China's slowing economy, where weak domestic demand and overcapacity in local industries are eroding profitability for the Americans.
'Businesses in China are less profitable now than they were years ago, but risks, including reputational risk, regulatory risk, and political risk, are increasing,' said Sean Stein, the president of the US-China Business Council, a Washington-based group that represents American companies doing business in China, including major multinationals.
The survey, conducted between March and May and drawing from 130 member companies, was released Wednesday. It came as the two countries clash over tariffs and non-tariff measures, including export controls on critical products such as rare-earth magnets and advanced computer chips.
Following high-level talks in Geneva and London, US and Chinese officials agreed to pull back from sky-high tariffs and restrictions on exports, but uncertainty persists as the two sides are yet to hammer out a more permanent trade deal.
Kyle Sullivan, vice president of business advisory services at the USCBC, said more than half of the companies in the survey indicated they do not have new investment plans in China 'at all' this year.
"That's a record high,' Sullivan said, noting that it is 'a new development that we have not observed in previous surveys'.
Around 40% of companies reported negative effects from US export control measures, with many experiencing lost sales, severed customer relationships, and reputational damage from being unreliable suppliers, according to the survey.
Citing national security, the US government has banned exports to China of high-tech products, such as the most advanced chips, which could help boost China's military capabilities.
Stein argued that export controls must be very carefully targeted, because businesses from Europe or Japan, or local businesses in China would immediately fill the void left by American companies.
Silicon Valley chipmaker Nvidia won approval from the Trump administration to resume sales to China of its advanced H20 chips used to develop artificial intelligence, its CEO Jensen Huang announced on Monday, though the company's most powerful chips remain under US export control rules.
While 82% of US companies reported profits in 2024, fewer than half are optimistic about the future in China, reflecting concerns over tariffs, deflation, and policy uncertainty, according to the survey.
Also, a record high number of American businesses plan to relocate their business operations outside of China, Sullivan said, as 27% of the members indicated so, up from 19% the year before.
In a departure from past surveys, concerns over China's regulatory environment, including risks of intellectual property misuse and lack of market access, didn't make it to the top five concerns this year. That's likely a first, and not for a good reason, Stein said.
'It is not because things got dramatically better on the Chinese side, but the new challenges, often coming from the US, are now posing as much of a challenge,' Stein said.
Almost all the American companies said they cannot remain globally competitive without their Chinese operations.
A survey from the European Union Chamber of Commerce in China in May found that European companies were cutting costs and scaling back investment plans in China as its economy slows and fierce competition drives down prices. SCY SCY
This article was generated from an automated news agency feed without modifications to text.
Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

Trump envoy Witkoff says US cuts short Gaza ceasefire talks as Hamas lacks ‘good faith'
Trump envoy Witkoff says US cuts short Gaza ceasefire talks as Hamas lacks ‘good faith'

Indian Express

time8 minutes ago

  • Indian Express

Trump envoy Witkoff says US cuts short Gaza ceasefire talks as Hamas lacks ‘good faith'

President Donald Trump's special envoy Steve Witkoff said Thursday the U.S. is cutting short Gaza ceasefire talks and bringing home its negotiating team from Qatar for consultations after the latest response from Hamas 'shows a lack of desire to reach a ceasefire in Gaza.' 'While the mediators have made a great effort, Hamas does not appear to be coordinated or acting in good faith,' Witkoff said in a statement. 'We will now consider alternative options to bring the hostages home and try to create a more stable environment for the people of Gaza.' It was unclear what 'alternative options' the U.S. was considering. The White House had no immediate comment, and the State Department did not immediately respond to messages. A breakthrough in talks on a ceasefire deal between Israel and Hamas has eluded Trump's Republican administration for months as conditions worsen in Gaza. The territory recently had its deadliest day yet for aid-seekers in over 21 months of war, with at least 85 Palestinians killed while trying to reach food Sunday. The sides have held weeks of talks in Qatar, reporting small signs of progress but no major breakthroughs. Officials have said a main sticking point is the redeployment of Israeli troops after any ceasefire takes place. Witkoff said the U.S. is 'resolute' in seeking an end to the conflict in Gaza and said it was 'a shame that Hamas has acted in this selfish way.' Earlier Thursday, Israeli Prime Minster Benjamin Netanyahu's office recalled his country's negotiating team back to Israel in light of Hamas' response. In a brief statement, the prime minister's office expressed its appreciation for the efforts of Witkoff and mediators Qatar and Egypt, but it gave no further details. The deal under discussion is expected to include a 60-day ceasefire in which Hamas would release 10 living hostages and the remains of 18 others in phases in exchange for Palestinians imprisoned by Israel. Aid supplies would be ramped up and the two sides would hold negotiations on a lasting truce.

Grok steps into prediction markets with xAI, Kalshi partnership
Grok steps into prediction markets with xAI, Kalshi partnership

Time of India

time8 minutes ago

  • Time of India

Grok steps into prediction markets with xAI, Kalshi partnership

Kalshi is now partnering with Elon Musk's artificial intelligence company xAI to integrate Grok, xAI's advanced chatbot, into the prediction market experience. Tired of too many ads? Remove Ads Elon Musk-led artificial intelligence company xAI announced its partnership with US-based trading platform Kalshi , marking its AI chatbot Grok 's foray into prediction confirmed the development on X on Thursday. 'Kalshi and xAI are partnering to bring Grok to prediction markets. Two of the fastest growing companies in America are now on the same team.'To be updated

Fake diplomat arrested from Ghaziabad: Multiple shell companies, 11 bank accounts in 4 countries — ‘Ambassador of Westarctica's' ops dates back to 2 decades
Fake diplomat arrested from Ghaziabad: Multiple shell companies, 11 bank accounts in 4 countries — ‘Ambassador of Westarctica's' ops dates back to 2 decades

Indian Express

time8 minutes ago

  • Indian Express

Fake diplomat arrested from Ghaziabad: Multiple shell companies, 11 bank accounts in 4 countries — ‘Ambassador of Westarctica's' ops dates back to 2 decades

After the Uttar Pradesh Police's Special Task Force (STF) busted a fake embassy operating from a rented house in Ghaziabad's Kavi Nagar, and arrested a man who claimed to be the 'Ambassador of Westarctica', the police on Thursday said that they have uncovered a complex international financial web – stretching from Rajasthan's marble mines to banks in Dubai, Mauritius and the United Kingdom. In a statement released on Wednesday, the STF said that 47-year-old Harsh Vardhan Jain had registered multiple shell companies abroad and maintained at least 11 bank accounts in four countries. It added that Jain's financial operations dated back to nearly two decades and were built on a 'modus operandi of fraud, hawala and brokerage' carried out under the garb of international diplomacy. The police said that Jain, who was arrested late Tuesday, has admitted during questioning that he worked closely with controversial figures like godman Chandraswami and arms dealer Adnan Khashoggi during his time in London. He also allegedly partnered with Ehsan Ali Syed, a Hyderabad-based businessman who took Turkish citizenship and is now serving a six-and-a-half-year sentence in Switzerland for defrauding multiple companies by promising large loans and taking brokerage fees in advance. According to the STF, Jain's ties to Syed were facilitated by Chandraswami, who introduced the two during Jain's stay in London in the early 2000s. It added that one of Syed's firms, Western Advisory Group – based in Switzerland and Bahrain – collected over 25 million pounds in brokerage from Swiss companies between 2008 and 2011. 'In collaboration with Ehsan, Harsh Vardhan formed several shell firms, including State Trading Corporation Limited, East India Company UK Limited, Island General Trading Co LLC (UK), Indira Overseas Limited (Mauritius), and Cameron Ispat SARL (Cameroon),' the STF said. Investigators have also identified at least six bank accounts that have been linked to Jain in UAE, three in UK, one in Mauritius, and one in India, the STF said. According to the STF, Jain's father J D Jain was a reputed industrialist and the owner of Jain Rolling Mill in Ghaziabad. '…there were mines in Banswara and Kakroli in Rajasthan by the name of Indira Marbles and 'JD Marbles', where (Jain) has also worked. Marble was also exported to London from these mines,' it added. In his statement, the police said, Jain has said that after completing his education, he had moved to Dubai in 2006 and allegedly began duping businessmen in the name of providing jobs abroad. 'He worked as a broker in Gulf and African countries. When he returned to India in 2011, he resumed operations from his family home before shifting to the rented bungalow,' the STF statement said. Jain, who the police said holds an MBA degree from London, had allegedly been using his connections and the illusion of a diplomatic clout to convince businessmen that he could secure them international deals and jobs abroad. 'He used false flags, fake diplomatic number plates, forged passports and seals to give the impression of being an influential international broker,' Senior Superintendent of Police (STF) Ghule Sushil Chandrabhan had told The Indian Express. He had also acquired honorary 'ambassador' and 'consigliere' titles from several self-styled micronations like Seborga, Poulvia, and Lodonia, which he used to influence people and extract money, police had said.

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into a world of global content with local flavor? Download Daily8 app today from your preferred app store and start exploring.
app-storeplay-store