Daily Memo: US Firms in China Stay Put, Protests in Belarus Continue

According to a new survey, most U.S. firms have no plans to relocate from China.

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No mass exodus. There’s still scant evidence that U.S. firms are gearing up for a mass exodus from China, despite growing pressure from the Trump administration to do so – and despite growing wariness among companies of getting caught in the U.S.-China crossfire. According to a new survey conducted by the American Chamber of Commerce in Shanghai, less than 25 percent of the 364 U.S. firms polled said they had plans to relocate any manufacturing out of China. Less than 4 percent of firms surveyed were considering moving operations back to the United States. The survey did suggest that firms are becoming leerier of China as a long-term solution, though, as the share of companies reporting plans to increase investment in China dropped from 47.2 percent in 2019 to 28.6 percent this year. The combination of China’s numerous advantages over alternate manufacturing hubs – especially with potential challengers like India still awash in the coronavirus – and the desire for access to the Chinese market makes cash-strapped companies exceedingly reluctant to leave. But Japan is proving that it is possible to shift the cost-benefit calculations of some firms enough to entice them away. Tokyo’s program offering subsidies to firms that […]

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