66% of American companies remain committed to Chinese market：report

China remains the most popular destination for enterprise investment, with 66% of American companies claiming that they will remain committed to the Chinese market, according to the 2024 Special Report on the State of Business in South China released by the American Chamber of Commerce in South China (AmCham South China) on February 27.

The report said 44% of the companies are bullish about China-US bilateral relations in the coming year, reaching a record high. Additionally, 86% of the companies claim that they will not decouple from the Chinese market due to the US-China trade tensions.

"The positive dialogues between the world's two largest economies, including the high-level summit meeting in San Francisco last November, have instilled renewed confidence in the business community and investors from the US, China, and across the globe," Harley Seyedin, President of the AmCham South China, said in the report.

90% of American companies have achieved profitability in China

The AmCham South China conducted a random sample invitation survey of more than 2,300 member enterprises, and finally selected valid questionnaires from 183 companies, over half of which are foreign-funded enterprises. Thirty-five percent of the companies surveyed are from the manufacturing industry, accounting for the highest proportion among all categories.

Based on the report, companies surveyed believe that they enjoy a high rate of return on investment (ROI) in China and feel optimistic about the prospects of the Chinese market. Eighty-eight percent of the companies surveyed have already made profits in China, and 90% of American companies have achieved profitability in China in 2023. Meanwhile, 66% of the companies actually reinvested in China, and 66% of American companies claim that they will remain committed to the Chinese market, representing the highest proportion of all businesses studied.

Foreign-funded enterprises still demonstrate high enthusiasm for investing in China, and most enterprises, especially those engaged in manufacturing, are willing to continue investing in South China. According to the latest data, in 2023, Guangdong's actual utilization of foreign investment in the manufacturing industry reached 49.22 billion yuan, a year-on-year increase of 11.7 percent, accounting for 30.9 percent of the province's total actual foreign investment, reaching a nearly five-year high.

Moreover, Guangdong has achieved remarkable results in attracting investment from developed countries. The actual investment in Guangdong's manufacturing industry from developed countries such as the United States, Japan, South Korea, and Europe reached 12.89 billion yuan, a year-on-year increase of 51.7 percent.

"Guangdong offers transparent governance, a massive consumer market from which we benefit, and opportunities for research and development, high technology, highly-qualified talent, and a very bright future," said Seyedin in a recent interview with GDToday. "American companies are happy to invest in Guangdong."

GBA features the most remarkable advantages in industrial complementary integration and development

In recent years, Guangdong has continuously improved its market-oriented and law-based international business environment, and joined hands with Hong Kong and Macao to build the Guangdong-Hong Kong-Macao Greater Bay Area (GBA) into a world-class Bay Area. Its series of efforts have also been recognized by foreign companies investing in this region. According to the report, 75% of the companies surveyed consider the overall business environment in South China as "excellent" or "good".

Based on the analysis in the report, more than half of the companies consider the growing local market as the primary reason for establishing a presence in South China, followed by "transportation and logistics advantages" and "proximity to Hong Kong and Macao special administrative regions and Taiwan Province." "The GBA is the future of China's economy with promising prospects. Major cities in the GBA have now been able to enjoy complementary advantages," Seyedin noted.

William Huang, EY China South Managing Partner, told GDToday that compared with the New York Bay Area, San Francisco Bay Area, and Tokyo Bay Area, the Guangdong-Hong Kong-Macao Greater Bay Area features the most remarkable advantages in industrial complementary integration and development. In recent years, with the construction of the Guangzhou-Shenzhen-Hong Kong-Macao Sci-tech Innovation Corridor, the high-end elements of innovation continue to gather, and the integration of industry, university, and research is also constantly strengthening. Cities such as Dongguan and Foshan are developing intelligent manufacturing, enabling the manufacturing industry in this region to gradually realize overall transformation and upgrading.

cnbayarea.org.cn & GDToday