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Shanghai
BusinessChina Business

US companies’ sales forecasts drop to 10-year low in AmCham Shanghai’s 2022 poll, as zero-Covid rules upend operations

  • The number of companies expecting annual revenue growth plunged by 29 percentage points to 47 per cent this year, from 82.2 per cent in 2021
  • The annual AmCham Shanghai survey, featuring 307 respondents this year, was a stark contrast to the optimism found in the 2021 poll

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Shoppers and visitors walked along Nanjing Road shopping street, in Shanghai on July 9, 2022. Photo:Bloomberg
Yaling Jiangin Shanghai

China’s travel restrictions and quarantine rules to wipe out the Covid-19 disease have hurt business confidence, driving revenue forecasts to the lowest in a decade, hundreds of US businesses said in Shanghai.

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“China is becoming less competitive for foreign investments,” said Sean Stein, the chairman of the American Chamber of Commerce (AmCham) in Shanghai, during the launch of its China Business Report survey. “It needs to act soon to rebuild confidence from companies. Otherwise, investment can and will go elsewhere.”

The annual survey, featuring 307 respondents this year, was a stark contrast to the optimism found in the 2021 poll. The number of companies expecting annual revenue growth plunged by 29 percentage points to 47 per cent this year, from 82.2 per cent in 2021, the survey found. One in three respondents said their investments planned for China had been redirected elsewhere in the past year.
The downbeat survey, released as Shanghai still faces sporadic lockdowns even after emerging from two months of a citywide shutdown in June, reflects how the over-the-top restrictions have threatened all aspects of business operations in China’s commercial hub. Production, logistics, office openings and visits by foreign executives have all been adversely affected by the zero-Covid restrictions, the report said.

Most Shanghai businesses – from multibillion dollar manufacturers such as Tesla, to corner grocers and cafes – had to shut down for two months during the city’s lockdown. Combined with deteriorating US-China relations and a slowing economy, the optimism among AmCham members have fallen to record lows. Small to medium companies tend to be less resilient than multinational firms, AmCham said.

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