The trade war between the United States and China has proven to be one of the biggest diplomatic and economic events of the past decade. The world’s two biggest economies have been locked in a bruising trade war since the end of last year, and no resolution is at sight as yet. The global economy has felt the pinch of the whole thing as well, and now a survey has revealed that the United States is further tightening the screw on China. The United States President, Donald Trump has taken an increasingly belligerent tone with regards to American companies who invest in China. A recent survey has revealed that Chinese investments from US companies are being canceled at a remarkably fast clip. On Wednesday, the American Chamber of Commerce in Shanghai released a report revealing that the rising tariffs in mainland China have forced many US companies to move away from doing business in the region.
The survey revealed as many as 26.5% of the companies decided to pull their investments from China and instead directed the investment to other areas. It reflects a remarkable 6.9% rise from last year, and it is a clear indication that many American businesses are now finding it difficult to do business in China. Some of the industries that redirected their investments from China include tech, hardware, and software. Over the years, many companies from those industries have invested billions of dollars in China and reaped benefits. However, it seems that the imposition of fresh tariffs made it impossible for those companies to do business in Asia’s biggest economy.
In addition to that tariffs, many of the firms stated that certain restrictions have now been placed with regards to access to the local Chinese market and that has proven to be another trigger for pulling out of investments. At the end of the day, the local Chinese market is the big prize for most companies simply due to its sheer size, and if a company does not get full access to it, then it can prove to be a large detriment. It remains to be seen how the trade war pans out over the next few months.