Page 8 - 2022 White Paper on the Business Environment in China
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2 White Paper on the Business Environment in China
President’s Message
It is important to note that the American such as laptops, furniture and bikes boomed.
Chamber of Commerce in South China The export surge has been good for China in the
(AmCham South China) is an entirely independent short term, helping keep growth solid throughout
member driven, non-partisan, non-political, non- the pandemic, but it is worsening an economic
government, non-profit business organization imbalance that Chinese leaders are struggling
accredited in 1995 by US Chamber of Commerce to address as the pandemic approaches its third
in Washington, DC. The information provided year. Unlike the US, which saw a rapid rebound
in this publication is researched and produced in consumer spending during the pandemic,
independently by AmCham South China and does China has seen consumption stay subdued.
not represent the views of the US or any other Retail sales still aren’t growing as rapidly as they
government or organization. AmCham South were before Covid-19. The most recent figures,
China receives no funding from any government for September, rose by 4.4% from a year earlier,
for the production of this publication. well below the 8% pace in the full year of 2019.
The weakness owes partly to the fact China didn’t
Building a yearly double-digit increasing dish out stimulus money like the US did, so its
economy is not as easy as it used to be. consumers weren’t flush with extra cash. It also
reflects a longer-term trend toward more saving,
At the close of 2019, China was continuing with many Chinese people deciding to sock away
its historic transition from being a superhigh- money during a time of uncertainty—especially
growth, emerging market to a mature, established with lingering fears of outbreaks. With all the
economy. At the time, even with some deceleration, problems facing this world and the uniquely
the Chinese economy was still expanding at a 6.1% historic relationship between China and the US,
annual clip, a figure that well outstripped most the 18th edition of our Special Report reminds us
other nations. The country was internationalizing of the overwhelming positiveness of American
rapidly via the Belt and Road Initiative, and per companies to continue to invest and contribute
capita disposable income was continuing to rise – to the growth of China. It may be time to take
all while showing resilience in the face of the trade another look at that sock drawer.
war with the US. Then, at the end of the year, a
novel coronavirus emerged that proverbially Last year, AmCham South China predicted a
knocked all the pieces off the table. GDP growth slowdown in the last quarter of 2023
and all of 2024 due to a lower number of planned
One might suspect that China’s trade war with projects of over US$250 million. This year’s 2022
the US convinced its leaders that the country Special Report on the State of Business in South
needed to move faster to expand its domestic China shows an increase of reinvestments in
consumer market so its economy would not sway large projects of US$250 million or more having
inconsistently by the trade winds from the West. taken place in 2021 and also our study shows an
The coronavirus pandemic, however, steered increase in budgeting for large projects in 2022.
the second largest economy in the world in the Therefore, we have updated our prediction to
opposite direction by making exports a larger show that the slowdown in China’s GDP growth
driver of growth than at any other time in years, will still happen in the last quarter of 2023 but
leaving the country more exposed to spending will be alleviated by mid-2024. From the Special
by western shoppers. Western demand for items Report: The number of companies which actually
8
President’s Message
It is important to note that the American such as laptops, furniture and bikes boomed.
Chamber of Commerce in South China The export surge has been good for China in the
(AmCham South China) is an entirely independent short term, helping keep growth solid throughout
member driven, non-partisan, non-political, non- the pandemic, but it is worsening an economic
government, non-profit business organization imbalance that Chinese leaders are struggling
accredited in 1995 by US Chamber of Commerce to address as the pandemic approaches its third
in Washington, DC. The information provided year. Unlike the US, which saw a rapid rebound
in this publication is researched and produced in consumer spending during the pandemic,
independently by AmCham South China and does China has seen consumption stay subdued.
not represent the views of the US or any other Retail sales still aren’t growing as rapidly as they
government or organization. AmCham South were before Covid-19. The most recent figures,
China receives no funding from any government for September, rose by 4.4% from a year earlier,
for the production of this publication. well below the 8% pace in the full year of 2019.
The weakness owes partly to the fact China didn’t
Building a yearly double-digit increasing dish out stimulus money like the US did, so its
economy is not as easy as it used to be. consumers weren’t flush with extra cash. It also
reflects a longer-term trend toward more saving,
At the close of 2019, China was continuing with many Chinese people deciding to sock away
its historic transition from being a superhigh- money during a time of uncertainty—especially
growth, emerging market to a mature, established with lingering fears of outbreaks. With all the
economy. At the time, even with some deceleration, problems facing this world and the uniquely
the Chinese economy was still expanding at a 6.1% historic relationship between China and the US,
annual clip, a figure that well outstripped most the 18th edition of our Special Report reminds us
other nations. The country was internationalizing of the overwhelming positiveness of American
rapidly via the Belt and Road Initiative, and per companies to continue to invest and contribute
capita disposable income was continuing to rise – to the growth of China. It may be time to take
all while showing resilience in the face of the trade another look at that sock drawer.
war with the US. Then, at the end of the year, a
novel coronavirus emerged that proverbially Last year, AmCham South China predicted a
knocked all the pieces off the table. GDP growth slowdown in the last quarter of 2023
and all of 2024 due to a lower number of planned
One might suspect that China’s trade war with projects of over US$250 million. This year’s 2022
the US convinced its leaders that the country Special Report on the State of Business in South
needed to move faster to expand its domestic China shows an increase of reinvestments in
consumer market so its economy would not sway large projects of US$250 million or more having
inconsistently by the trade winds from the West. taken place in 2021 and also our study shows an
The coronavirus pandemic, however, steered increase in budgeting for large projects in 2022.
the second largest economy in the world in the Therefore, we have updated our prediction to
opposite direction by making exports a larger show that the slowdown in China’s GDP growth
driver of growth than at any other time in years, will still happen in the last quarter of 2023 but
leaving the country more exposed to spending will be alleviated by mid-2024. From the Special
by western shoppers. Western demand for items Report: The number of companies which actually
8
