Employees work on Baojun RS-5 cars at a final assembly plant operated by General Motors Co and its local joint-venture partners in Liuzhou, Guangxi Zhuang Autonomous Region, China. — Reuters photo
BEIJING: Frustrated US businesses can no longer be counted on as a ‘positive anchor’ in US-China relations, a top US business lobby said yesterday, arguing any deal to end trade tensions must address structural problems in China’s economic system.
Long considered the ballast in a relationship fraught with geopolitical frictions, the US business community in China in recent years has advocated a harder line on Beijing’s trade policies.
“Crucially, the mood has shifted,” the American Chamber of Commerce in China said in a statement accompanying its annual report on China’s business climate.
“The US business community in China, so long an advocate of good bilateral relations, can no longer be relied upon to be a positive anchor. US companies continue to face an uncertain operating environment in China amid decreasing optimism about their investment outlook,” it said.
The world’s two biggest economies are nine months into a trade war that has cost billions of dollars, roiled financial markets and upended supply chains.
US President Donald Trump has slapped tariffs on US$250 billion of goods imported from China to press demands for an end to policies – including industrial subsidies, forced technology transfers, and market access barriers – that Washington says hurt US companies.
China has responded with its own tit-for-tat tariffs on US goods.
The chamber said tariffs had negatively impacted many of its members who “are not necessarily supportive” of their use, but earlier attempts at dialogue had failed to balance economic relations.
“We understand that any true resolution of the current dispute requires addressing the structural issues …that have long hindered importation of US goods and services and operations of US businesses in China,” the chamber’s chairman, Timothy Stratford, said in the report.
A chamber survey in February showed a majority of its members favoured the United States retaining tariffs on Chinese goods while Washington and Beijing try to hammer out a deal to end the trade war.
It noted then that 19 per cent of its companies were adjusting supply chains or seeking to source components and organise assembly outside of China as a result of tariffs.
Many in the business community have expressed concern that Trump could settle for a deal that increases commodity sales to China, while doing little to change China’s underlying trade practices and industrial policies.
Reuters reported on Monday that US negotiators have tempered demands that China curb industrial subsidies as a condition for a deal after strong resistance from Beijing. But Trump and US negotiators have repeatedly said talks with China were going well. — Reuters