So what's up? Are Japanese goods far more attractive than American products in China?

Charlie Martin, president of AmCham. [amcham-china.org.cn]

"No," said Charlie Martin, president of the American Chamber of Commerce in China (AmCham). "All branches of the US Government need to recognize that our failure to take full advantage of the opportunity that China presents is contributing to our bilateral trade deficit."

Martin made the remarks Tuesday when releasing the chamber's annual white paper on American business in China.

The paper urges Washington to take concrete steps to improve commercial relations with China including improving export promotions, visa policies and export controls or American competitiveness in China would be in jeopardy.

Washington has frequently blamed China's trade and currency policies for its huge deficit with the country. According to US figures, its trade deficit with China increased by 24 per cent to US$202 billion last year; China puts the figure at US$102 billion, using different calculation methods.

Both Japan and Germany have substantial government offices and industry organizations to promote trade; and the United States ends up ceding market share to competitor countries because they devote more resources, Martin said.

The paper urged the US Government to significantly expand investment in export promotion at the federal and state levels with a focus on helping small- and medium-sized firms sell more products to China.

"Committing more resources and searching for better approaches will greatly enhance our commercial dialogue, one that has suffered recently from fear, apprehension, and misunderstanding," said Martin.

US companies will trail the competition in capturing China market share if the US Government fails to do its job, the paper said.

As China modernizes and its buying power increases, US export opportunities will increase as many high-end products made in the United States will be attractive to the Chinese.

The chamber urged Washington to review policies that create uncertainty for potential Chinese customers, such as tough visa procedures and a restrictive and non-transparent export control regime.

The visa policy remains a distinct deterrence to "buying American," said Donald R. Forest, co-chair of the chamber's Public Policy Development Committee

Understaffed consular missions and cumbersome visa process continue to unwittingly drive potential Chinese customers to the Europeans, Japanese and others.

The paper said 44 per cent of companies surveyed said they lost "significant business" while nearly 70 per cent have stopped arranging meetings in the United States due to worries about potential visa obstacles.

Export controls are another big concern for US companies. Though the Chinese Government has repeatedly pointed out that it is a key problem in the huge deficit, the US Government has done little to improve the situation.

AmCham fully supports a targeted and efficient export control programme that keeps American military technology safe, Martin said however, the current programme is neither sufficiently targeted nor efficient as relevant rules are vague.

"This costs US firms jobs and diverts business to our competitors," he added.

Many US technology firms feel that the controls do little to protect national security as the relevant technologies can be purchased from non-US sources, while their own economic strength is being eroded.