Pandemic-related restrictions over the past two years have delayed project sourcing and due diligence, leading to lower investment in three to five years
China’s strict COVID-19 controls will hamper foreign investment in the country for years to come as limits on travel block the project pipeline, the president of the American Chamber of Commerce in China said yesterday ( AmCham), Michael Hart.
There are few signs that U.S. companies are exiting the Chinese market, but the years-long project research and due diligence process has been delayed, Hart said at a launch event for the company’s annual report. room.
“We are very concerned about ongoing and future investment by U.S. and foreign companies in China because people cannot access it in terms of travel,” he said.
“Unfortunately the COVID lockdown this year and the restrictions of the past two years are going to mean in three, four, five years we will most likely see a drop in investment,” he said.
While much of the world has lifted COVID-19 restrictions, China has strictly limited flights into the country and insisted that a “zero COVID-19” approach is needed to prevent the country’s health resources are not overwhelmed.
The restrictions also cause foreign companies with supply chains in China to seek alternative sources to reduce disruption, Hart said.
The chamber’s report cites market access restrictions, discriminatory regulations and intrusive cybersecurity requirements as top concerns for American businesses.
The chamber last week released a flash survey that warned of an ‘exodus’ of foreign staff to China due to COVID-19 measures and ongoing lockdowns, saying 58% of members had reduced their income projections for the year.
European businesses are bracing for the next wave of disruption from COVID-19 outbreaks, with little chance of improvement until China increases vaccination rates, the European Chamber of Commerce in China said on Monday. .
Data released on Monday showed the havoc wreaked on the economy by Shanghai’s lockdown and restrictions in dozens of other major cities, with retail sales and industrial production plunging at their fastest pace in more than two years. in April.
The state planner said it would boost support for manufacturers, the service sector and small businesses to mitigate the impact of COVID-19.
A meeting called by China’s top policy advisory body with tech executives was also closely watched to hear how far authorities would go to ease the regulatory crackdown on the sector that began in late 2020 and has weighed on growth.
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