AmCham says China still a magnet for US firms

China's renewed business momentum will spur US companies in the country and encourage them to tap new growth opportunities in emerging business sectors next year, said a senior US business representative on Monday.

"The Chinese economy has clearly recovered from the COVID-19 pandemic, and we see that reflected in the exports of manufactured products as well as domestic services. Global demand for electronics and medical supplies in particular has helped China's exports return to normal," said Ker Gibbs, president of the American Chamber of Commerce in Shanghai.

He said China's supply chains have proved to be extremely reliable during the COVID-19 pandemic. US companies expect China to provide more healthcare and social services during the 14th Five-Year Plan period (2021-25), as it is important to offer more services to the country's aging population.

Gibbs expects China to stop providing annual GDP targets over the next five years. Dropping these targets would give policymakers more to plan for the long term, which is necessary as the demographic challenge grows, he said.

Meanwhile, US companies in China have no intention of pulling out or reshoring their operations. About 82 percent of the respondents in a recent survey, covering 124 US companies, said they have no plans to move their manufacturing facilities offshore over the next three years. The survey, conducted from Nov 11 to Nov 15, was released by the AmCham Shanghai last month. The chamber currently has 3,000 members from 1,500 US companies and 21 industry sector committees in China.

Perry Zheng, president for China operations at Otis Corp, a US manufacturer of elevators and escalators, said China is a critical part of the group's global footprint and the largest new elevator equipment market in the world. As the country moves at full speed to open up to the outside, and with the new digital infrastructure initiative, the company is investing in new technologies and developing new services to stay competitive.

"We are committed to embracing the opportunities arising from China's opening-up and collaboration, helping stimulate economic growth and providing benefits to residents and businesses across the country," he said.

Wei Jianguo, vice-chairman of the China Center for International Economic Exchanges in Beijing, said China has become increasingly important over the last several years for multinational firms as its market has a large number of consumers to offer growth opportunities.

Global big names such as Apple, Nike, Adidas, L'Oreal and Lancome sold products worth over 100 million yuan ($15.2 million) in gross merchandise value on its platforms during the Singles Day shopping festival from Nov 1 to Nov 11, according to data released by Alibaba Group.

Bruno Schiavi, CEO and co-founder of Uncle Bud's, a California-based skin care and personal care product maker, said his company started to run its flagship store on Tmall, Alibaba's online shopping platform, last month to promote the sales of its CBD and Hemp products.

"Similar to most countries, consumer appetite for personal care products had an exponential growth this year in China. People have been pushed to do more at home and conduct beauty treatment themselves as many salons and professional services were closed," he said, adding personal care products and services, and other wellness products have become fairly popular across the world this year.

"The US and China have benefited enormously from trade and investment, and it is important that we continue to make improvements to drive job creation and growth in both countries," said Tom Linebarger, chairman and CEO of Cummins Inc, a US-based engine manufacturer.