europe.chinadaily.com.cn
US Tariffs Impose Real Costs on American Businesses in China
A survey of 130 US companies in China by the US-China Business Council reveals that US tariffs are significantly impacting 68 percent of businesses, causing lost sales and reputational damage, despite 80 percent reporting profits in 2024. Three of the top five business concerns are geopolitical, stemming from US policies.
- What are the most significant negative impacts of US tariffs on American companies operating in China, and what is their overall impact on business confidence and investment?
- The 2025 US-China Business Council survey reveals that US tariffs are significantly harming American companies in China, causing lost sales, damaged reputations, and increased costs. Despite these challenges, the vast majority of US firms (80%) remain profitable in China and view their operations there as crucial for accessing its large consumer market and driving innovation.
- How have US policies, particularly tariffs and export controls, altered the primary challenges faced by American businesses operating in China, and what proportion of companies have adapted?
- The survey highlights a shift in business challenges, with three of the top five concerns stemming from US-China geopolitical issues, specifically US tariffs. This underscores the significant impact of US policy on American businesses operating in China, outweighing traditional regulatory concerns. The high percentage of companies (68%) experiencing negative impacts from tariffs, particularly in industrial manufacturing and technology sectors, highlights a systemic problem.
- Given the ongoing trade tensions and the reported negative impacts of US tariffs, what are the likely long-term implications for the competitiveness of American companies in China and their future investment strategies?
- Looking ahead, the survey suggests a potential divergence between China's profitability and global averages for US firms. While 82% reported profits in 2024, only 25% expect China's profit margins to surpass global averages in 2025, indicating a possible weakening of the Chinese market's advantage. The significant number of companies re-orienting supply chains (39%) signals a broader shift in global business strategies as companies adapt to geopolitical pressures.
Cognitive Concepts
Framing Bias
The headline and introduction frame the story primarily around the negative consequences of US policies on American businesses operating in China. While the report acknowledges the importance of the Chinese market, the emphasis is placed on the difficulties, potentially influencing readers to perceive the relationship as overwhelmingly negative.
Language Bias
While largely neutral in tone, the report uses phrases such as "fraught relationship" and "punitive tariffs," which carry negative connotations. More neutral alternatives could include "strained relationship" or "tariffs imposed by the US." The repeated emphasis on negative impacts also subtly shapes the reader's perception.
Bias by Omission
The analysis focuses heavily on the negative impacts of tariffs and US-China relations on US companies, but gives less attention to the potential benefits or perspectives from the Chinese side. While acknowledging the survey's scope, a more balanced perspective could include views from Chinese businesses or government officials to provide a more complete picture of the economic relationship.
False Dichotomy
The report presents a somewhat simplistic eitheor framing of the US-China relationship, focusing primarily on the challenges faced by US companies without fully exploring the complexities or potential for cooperation. The narrative leans towards portraying the tariffs as solely detrimental, overlooking potential positive outcomes or strategic considerations.
Sustainable Development Goals
US tariffs negatively impact US companies operating in China, leading to lost sales, severed customer relationships, and reputational damage. This undermines their competitiveness and economic growth, affecting jobs and profits. The survey shows that 68% of companies reported impacts from tariffs, with over 90% of industrial manufacturing and technology companies feeling the effects. Rising input costs are a major challenge, disrupting production and squeezing profit margins. The reorientation of supply chains by some companies also indicates economic disruption.