American Companies Plan to Leave China, How Will the Trade War Impact Your Business?

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US Companies Leaving China Amid Trade War

Roughly one third of surveyed American companies in China will cancel or delay investments in the country due to the ongoing trade standoff with the U.S., according to a May report from the American Chambers of Commerce in China and Shanghai.

Even more of those companies, roughly 40 percent, said they are considering moving their manufacturing facilities out of China to locations like southeast Asia or Mexico, reported Financial Times.

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AmCham China and AmCham Shanghai surveyed 239 American companies from Thursday to Monday, according to CNBC. The survey found that American companies are seeing more obstacles during this tit-for-tat trade war.

For example, 74.9 percent of the two groups’ members said they had experienced negative side effects of the trade dispute, according to CNBC. That includes about one-fifth who say they have been subjected to increased inspections and slower customs clearance.

The U.S. and China have been raising tariffs on each others’ goods since summer 2018. Most recently, China imposed duties ranging from 5 percent to 25 percent on $60 billion in U.S. goods on June 1. That move came in response to the U.S. increasing tariffs from 10 percent to 25 percent on $200 billion in Chinese goods May 10, reported CNBC.

But U.S. businesses in China are also nervous after President Donald Trump’s decision to severely restrict Chinese telecommunications giant Huawei’s access to American big tech companies. That decision unfurled after trade talks with Beijing broke down and has reportedly caused Google to rethink doing business with Huawei.

“Particularly in the wake of the decision to put Huawei on the… entity list, there are concerns that the government of China may decide to retaliate against American companies,” AmCham China chair Tim Stratford said according to a Wednesday BBC story.


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