Unequal access to US business

Unequal access to US business


January 21, 2021, Chinese and US flags outside the building of an American company in Beijing, China.

King Tinche | Reuters

Beijing — Many U.S. companies in China still find it difficult to operate domestically compared to Chinese companies in the U.S., the U.S. Chamber of Commerce in China said in a report released Tuesday. ..

“Am Cham China members have faced long-standing structural challenges in the Chinese market and are trying to compete with (foreign-affiliated companies) and foreign investors,” the report said. Stated.

“Two-thirds of the members say they will consider increasing investment in China if the market is as open as the United States, which is a slight increase compared to last year,” the author said. Is writing.

Chinese foreign companies often have to work with local partners and face many restrictions on local investment, while Chinese companies can do business in the United States with much less restrictions.

Despite increasing pressure on Beijing under former President Donald Trump’s administration, market access challenges remain.

Trump has used tariffs and sanctions to address long-standing complaints about Chinese business practices, such as lack of intellectual property protection and demands for technology transfer to businesses.

According to the report, the following are some industries in which US companies are at a disadvantage in China.

  • Healthcare services — Foreign investment in Chinese medical institutions cannot exceed 70%.In comparison, there is no such cap in the United States.
  • Cloud computing — Foreign companies cannot invest more than 50% in the cloud service business.There is no such limit in the United States
  • movies — The Chinese government has set a release date for the film, requiring 75% of its revenue to remain with Chinese filmmakers. In the United States, Chinese companies can distribute movies without restrictions and set their own release dates.

IP improvement area

The central government of China has taken steps to improve the business environment of foreign companies in recent years. A New foreign investment law Beijing has lifted restrictions on ownership in finance and other industries, which came into effect last year.

Local civil servants are responding to the level of tension in their relationships and feel they are on a safer path than prioritizing domestic industry.

Greg Gilligan

Chairman of the American Chamber of Commerce in China

“Chinese courts have improved on intellectual property disputes,” Amcham Policy Committee chairman Lester Ross told reporters on Tuesday. Citing his view as a lawyer, he said, “Chinese courts have become somewhat fair.”

AmCham also found that over the past year, 47% of its members have stated that their intellectual property enforcement has improved overall.

Political tension makes business difficult

However, political tensions between the United States and China have become a major challenge for AmCham members operating in Asian countries, the report said.

In a meeting with reporters on Tuesday, Greg Gilligan said the political environment made it even more difficult to implement central government policies to support foreign businesses at the city level.

“Local authorities are responding to levels of tension in relations and feel they are on a safer path than prioritizing domestic industry,” he said.

Gilligan expects tensions between the two countries to continue for at least the next two years. Domestic politics It requires each leader to maintain a firm stance towards other countries.

President of the United States since taking office in January Joe Biden While maintaining tariffs and sanctions during the Trump era, it has sought to work with traditional US allies to put pressure on China.

According to the report, China, the world’s second-largest economy, is a “priority market” for more than two-thirds of AmCham’s members. According to a survey, nearly 85% of members have no plans to move manufacturing or sourcing away from China in the near future, according to the business organization.

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