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Ananta Agarwal

US companies in China have reported marginal improvements in business conditions, but inconsistent coronavirus restrictions across the country continue to pose a challenge to supply chains and production, the American Chamber of Commerce in China (AmCham China) said on Thursday.
China has stepped up efforts to placate a frustrated foreign business community over the past two months, streamlining communication, easing interprovincial travel restrictions and, this week, reducing quarantine for overseas visitors to seven days at a government-run facility.
While a host of issues remain, there are signs Beijing’s efforts are making progress with foreign investors.
Of the 102 companies surveyed by AmCham China, 45 per cent reported continued disruptions to their transport and shipping networks in June, but that was a 16 percentage-point decrease compared to May.
China tries to calm jittery investors after shock of Shanghai lockdown
Businesses in Shanghai also reported improvements in supply chain logistics after the city emerged from a stringent two-month lockdown on June 1. Some 23 per cent of respondents reported little to no business recovery this month, compared to 60 per cent in May.
AmCham China said the reduction in quarantine time for all inbound passengers was “a step in the right direction”, but “plethora of issues” remained, including inconsistent implementation of coronavirus rules across different provinces.
Citing an example from their own office in Beijing, AmCham China chairman Colm Rafferty said that when five employees were identified as being exposed to Covid-19, each of them received separate directives from their local neighbourhood committees. These ranged from Covid tests to 10 days quarantine.
“That is a huge difference for any company to manage,” said Rafferty, adding that “a higher degree of predictability and consistency” in policy enforcement is needed.


A total of 77 per cent of respondents said the primary reason foreign employees were choosing to leave China or not relocate there was due to “uncertainty around the length of quarantine and lockdowns”.
China has shown signs of economic recovery in June, with the manufacturing and services sectors expanding for the first time since February.
But the economic outlook is cloudy, and 69 per cent of American companies reported decreased yearly revenue projections in June, up 11 percentage points from May, according to AmCham China.
President Xi Jinping has affirmed that Beijing will press on with the ‘zero-Covid’ strategy, even though it might hurt the economy.
Last month, Premier Li Keqiang warned about the risk of an economic downturn in the second quarter, while ordering local authorities to front load measures to support business and mitigate the disruption of Covid controls.
As these survey results make clear, there remains a plethora of issues negatively impacting our member companies
Colm Rafferty
However, 56 per cent of companies surveyed by AmCham China said the support policies and their implementation were “insufficient”. Some 43 per cent of respondents stated they were ineligible for government aid.
“As these survey results make clear, there remains a plethora of issues negatively impacting our member companies resulting from pandemic-related restrictions,” said Rafferty, adding that “it is still exorbitantly expensive to travel to China”, which continues to affect investment decisions.
With the abatement of the recent Omicron outbreak, 44 per cent of the respondents reported delaying or decreasing their investments in the country, down eight percentage points from May.
“As before, we urge the government to seek an even more optimal balance between pandemic prevention, economic development, and opening up of the country,” said Rafferty.


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US firms in China praise quarantine cut, but coronavirus restrictions still weigh heavy on confidence

Beijing has stepped up efforts to placate frustrated US and European firms in China over the past two months. Photo: AP

Beijing has stepped up efforts to placate frustrated US and European firms in China over the past two months. Photo: AFP

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The US commerce department put five Chinese firms on the “entity list” on Tuesday, effectively blocking US businesses from selling them materials and equipment. Photographer: Qilai Shen

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Beijing says it is focused on helping foreign firms affected by lockdowns to resume business in Shanghai and elsewhere. Photo: EPA-EFE

Beijing says it is focused on helping foreign firms affected by lockdowns to resume business in Shanghai and elsewhere. Photo: Reuters

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US firms in China have reported small improvements in supply chain logistics and business recovery, AmCham China survey shows
But a ‘plethora of issues’ remain, including inconsistent implementation of coronavirus rules across different provinces, the group says



US firms in mainland China have reported small improvements in supply chain logistics and business recovery, a new survey shows, but Covid-related policymaking still lacks consistency and predictability.


US firms in China praise quarantine cut, but coronavirus restrictions still weigh heavy on confidence

US firms in China have reported small improvements in supply chain logistics and business recovery, AmCham China survey shows But a ‘plethora of issues’ remain, including inconsistent implementation of coronavirus rules across different provinces, the group says

US firms in China have reported small improvements in supply chain logistics and business recovery, AmCham China survey shows

But a ‘plethora of issues’ remain, including inconsistent implementation of coronavirus rules across different provinces, the group says