SOURCE: The US-China Business Council

The US-China Business Council

November 17, 2010 10:51 ET

USCBC Members' China Outlook: Committed but Concerned

"US companies remain committed to doing business in China and report growing revenues and investments. At the same time, concerns about protectionism and continued market access barriers are persistent and increasing."

WASHINGTON, DC--(Marketwire - November 17, 2010) - Today the US-China Business Council (USCBC), an organization representing roughly 220 leading US companies selling American goods and services to the China market, released its 2010 Member Priorities Survey Results.

"US companies remain committed to doing business in China and report growing revenues and investments. At the same time, concerns about protectionism, intellectual property protection, and continued market access barriers are persistent and increasing," said USCBC President John Frisbie. "For many USCBC members, these concerns are less about real impact on current operations than they are about policy and regulatory trends that could seriously hinder foreign companies and discourage future investments, if the trends continue and the policies are fully implemented."

"US companies continue to display impressive financial results from their China business. Even in a down year globally, 87 percent of respondents stated their China operations posted revenue growth in 2009, and close to 90 percent said profit margin rates in China equaled or exceeded their company's global margins.

"However, even with this commercial success, US companies are showing signs of caution due to growing trends of protectionism and policies that could curtail market access and fair competition," concluded Frisbie.

Top 10 concerns cited by USCBC member companies:

1. Human resources: talent recruitment and retention (tie)
1. Administrative licensing, business, and product approvals (tie)
1. Competition with state-owned enterprises (tie)
4. Intellectual property rights enforcement
5. Cost increases
6. Market access in services
7. Transparency
8. Protectionism risks in China
9. Government procurement
10. Standards and conformity assessment 

Contrary to conventional wisdom, US companies don't invest in China to offshore production and export back to the United States. Most US companies are there to reach China's growing and dynamic marketplace by selling high-quality manufactured goods or world-class services.

Frisbie explained, "Once again, 96 percent of survey respondents indicated their primary objective for being in China is to serve the China market."

USCBC's 2010 Member Priorities Survey Results -- US Companies' China Outlook: China Operations Profitable and Growing; Protectionism Concerns Real and Rising -- is available at: http://www.uschina.org/public/documents/2010/membership_survey.pdf 

The US-China Business Council (USCBC) is a private, nonpartisan, nonprofit organization of roughly 220 American companies that do business with China. For nearly four decades, USCBC has provided unmatched information, advisory, advocacy, and program services to its membership. Through its offices in Washington, DC; Beijing; and Shanghai, USCBC is uniquely positioned to serve its members' interests in the United States and China.

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