SHANGHAI, Jan. 9 (Xinhua) -- Amid evolving geopolitical dynamics, China continues to be the primary base for U.S. companies' production and a crucial part of their strategic planning, said Eric Zheng, president of the American Chamber of Commerce in Shanghai (AmCham Shanghai), in a recent interview with Xinhua.
Zheng noted that while geopolitical uncertainty, particularly in bilateral relations between the United States and China, remains the top challenge for U.S. companies in China, AmCham Shanghai member companies are not leaving the Chinese market due to its critical importance to their businesses.
He said that member companies like 3M, which has thrived in China for 40 years by adapting to market changes since entering after China's reform and opening up, are here for the long term.
"China is not just a piece of the puzzle, but a core component of their long-term strategy. That's why our companies are committed to this market for the long term," Zheng added, emphasizing the need for U.S. companies to maintain a positive outlook and develop strategies that leverage their strengths to succeed commercially in China.
The U.S. trade policy has garnered significant attention due to its promises to impose tariffs on China and other trade partners. Even if not all of these measures materialize, a strongly protectionist agenda is expected to take shape, with tariffs as the main tool.
Zheng stressed that tariffs are not the best solution for trade disputes. "The best way is to figure out what the key issues are and find other ways rather than using tariffs."
Noting that tariffs ultimately hurt consumers more than exporters, he called for continued dialogue between the United States and China to explore more sensible and effective solutions.
Zheng also sees potential for collaboration between the two countries in rebuilding manufacturing capacity. "The United States is trying to rebuild its manufacturing capacity, and China is in an excellent position to support that," he said. "China's competitive and sophisticated manufacturing ecosystem can certainly help the U.S. in this regard."
He also emphasized the importance of the two countries working together to address global challenges such as health, climate change, and AI governance. "It's important for these two countries to work together, whether they have differences," he said, highlighting the need for joint efforts to develop global solutions.
During the Central Economic Work Conference in December 2024, Chinese leadership outlined key economic priorities for 2025, including adopting a more proactive fiscal policy, setting a higher deficit-to-GDP ratio, and implementing a moderately loose monetary policy, as part of a broader set of measures to stimulate economic growth.
Looking ahead to 2025, Zheng believes that policy stimulus will be crucial. He said that the focus is more on proactive macroeconomic policies, including both fiscal and monetary measures, with an emphasis on stimulating consumption to boost demand, which he views as a positive move.
"We were also impressed by the message that the government will continue to encourage foreign investment," he said, adding that this will ensure that foreign investors continue to thrive in China.
AmCham Shanghai, a non-profit, non-partisan business organization, has over 3,000 members from over 1,000 companies. It is committed to the principles of free trade, open markets, private enterprise, and the unrestricted flow of information. ■