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US Businesses Optimistic About Future Operation in China
On the eve of Beijing's entry into the World Trade Organization (WTO), American enterprises operating in China appear sanguine about their business outlook in the country, according to the 2001 White Paper issued recently by the American Chamber of Commerce in the People's Republic of China (AmCham-China).
A survey conducted by AmCham-China in 2000 showed that 91 percent of 160 respondents to a membership questionnaire said that they were either cautiously optimistic or optimistic about their business perspective for the next five years, said the White Paper, which focuses on American business in China.
The Millennium year brought stabilization and renewed growth for the economies of Asia, and the end of the Asian recession engendered accelerated growth of China's exports, the White Paper said.
"Buoyed by the bilateral US-China relations recovered from earlier setbacks and dialog resumed between the presidents of the two countries. Recent slowing of China's economic growth ended with a renewed upturn in the reported GDP growth rate," it said.
The document noted that AmCham-China members anticipate reduced tariffs, better distribution channels, more impartial and objective tendering practices, stronger legal protection of intellectual property, improved ownership structures, and more international-standard accounting and business practices in China after the country joins the WTO.
Since the fall of 1999, the United States and China have made " unambiguous commitments" to deepening their commercial relationship. They agreed on the terms of China's WTO accession, a key step in the process of realizing China's entry, the White Paper said.
It added that the US Congress granted China permanent normal trade relations (PNTR) status and, in the process, reaffirmed bipartisan support for the fundamental approach of the China policy of every American president since normalization of relations in 1979.
"In addition to renewed confidence in the bilateral relationship arising from these developments, American business sentiment in China reflects the feeling that the Chinese economy has recovered, from both the residual effects of the Asian financial crisis as well as some of its domestic economic strains, " the document said.
The White Paper praised "China's careful management of foreign debt, high foreign currency reserves and capital controls," which it said have "protected the nation from the worst effects of the Asian financial crisis." (more)
In the document, AmCham-China, which is composed of 685 member companies and 1,550 individuals, also urged the U.S. government to further ease restrictions on high-tech exports to China.
China's accession to the WTO "will entail significant opportunities for all exporters of high-tech goods and services," which "demands a fresh look at the U.S. government's export control policy toward China," the White Paper said.
It pointed out that China, already a top market for high-tech exports, "has the potential to be the world's largest purchaser of U.S. high-tech goods and services in the near term."
According to U.S. government statistics, since 1994, U.S. exports of these products to China, which include computers and office equipment, consumer and industrial electronics, electro- medical equipment, photonics, semiconductors, and electronic components, have grown by 125 percent, one of the fastest-growing categories of U.S. exports to China.
In 1998, U.S. high-tech manufactured exports to China totaled over 3 billion U.S. dollars, it said.
It noted that China's telecommunications, computer, and semiconductor markets are likely to offer significant opportunities to U.S. firms, with projected annual growth rates of 20-40 percent over the next 15 years.
According to aerospace exporters forecast, over the next 10 years, U.S. satellite and related equipment sales to China could exceed 3 billion dollars, it added.
While stressing that the viability of the high-tech industries in the United States depends on continued trade and engagement with China, the White Paper expressed worry about the U.S. government's export control policy.
"The United States is not alone in producing and promoting many of these technologies. If high-tech business opportunities go to foreign competitors, the U.S. technological lead in these key sectors might seriously erode," it said.
The White Paper pointed out that other governments' restrictions on their export activities often are "not as stringent as those of the United States," and therefore "to further restrict U.S. firms' export of dual-use technology to China would force U.S. companies "to cede the playing field to other nations."
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