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number one preferred investment destination countries have whetted companies’ interest to
in China, which remains unchanged for four increase reinvestment in China or shift investment
consecutive years, followed by Shanghai, Shenzhen, to China.
and Beijing. Other cities including Dongguan,
Chengdu, and Zhuhai are found to attract investors’ The studies show that 73% of American and 70% of
interest. Chinese companies studied plan to reinvest in China
in 2021, while only 57% of participants from EU and
With 2020 being the first year in which China’s other countries have reinvestment plans. The vast
economic size expanded beyond the 100 trillion majority of companies still have expansion plans in
yuan (US$ 15.43 trillion), foreign markets continue China for the following three years. Nevertheless, in
to look at China for business opportunities in a post- view of the long-term impact brought by COVID-19,
pandemic world. Most companies reported positive the proportion of companies expanding in China in
overall returns on investment (ROI) in 2020 in the next three years hit a new low compared to the
China, which were higher than their global ROI. past five years
Compared to the previous year, more companies Nearly half of the participating companies show
believe that they will see improvement in US-China confidence in employment expansion despite
relations in 2021. Dr. Seyedin said “There is a the fact that China’s economic growth reached
general consensus within the business community an all-time low in nearly three decades in 2020.
that the Biden administration will view the US- Last year witnessed a steady upswing in business
China relation through a different looking glass. environment in South China. However, companies
I predict a rather long honeymoon period within report that rising operation and labor costs as well
which the two sides will have an opportunity as, lack of qualified personnel are three serious
to examine their differences, evaluate what is challenges for development in South China.
important to each side and begin friendly and
mutually respectful dialogue. Dr. Seyedin also said An overwhelming majority of companies stated
“I expect US and China to hit a reset button and that visa and travel restrictions have an adverse
very likely start a new era of cooperation which will impact on their operation. Over 50% of them were
benefit not just US and China but the entire globe.” affected by China’s visa and travel restrictions while
approximately 40% of them were influenced by
Key takeaways of the 2021 White Paper on the American restrictions.
Business Environment in China and the 2021
Special Report on the State of Business in South 2021 White Paper & Special Thank you, sponsors!
China include 94% of American companies see a Report Free Download
bright prospect in China’s market, and none of the Here
companies surveyed showed any willingness to
leave China completely.
China remains the top investment destination by
more than half of the studied companies despite its
decreasing attraction as a manufacturing base. The
study shows a very interesting direct connection
between the reduced number of expatriate
executives in China and the substantial reduction
in very large planned reinvestments. While number
of small, medium and small reinvestment projects
have held steady, and the total amount of planned
reinvestments have stated relatively the same, the
number of very large projects involving 250 million
US dollars or more each have reached the lowest
levels in several years
While a combination of factors including the
coronavirus pandemic severely impacted the
global economy in 2020, only a slight decrease in
actual reinvestment in China was realized. Factors
including huge market potential, preferential
policies and uncertainties of pandemic in other
SOUTH CHINA BUSINESS JOURNAL 10
in China, which remains unchanged for four increase reinvestment in China or shift investment
consecutive years, followed by Shanghai, Shenzhen, to China.
and Beijing. Other cities including Dongguan,
Chengdu, and Zhuhai are found to attract investors’ The studies show that 73% of American and 70% of
interest. Chinese companies studied plan to reinvest in China
in 2021, while only 57% of participants from EU and
With 2020 being the first year in which China’s other countries have reinvestment plans. The vast
economic size expanded beyond the 100 trillion majority of companies still have expansion plans in
yuan (US$ 15.43 trillion), foreign markets continue China for the following three years. Nevertheless, in
to look at China for business opportunities in a post- view of the long-term impact brought by COVID-19,
pandemic world. Most companies reported positive the proportion of companies expanding in China in
overall returns on investment (ROI) in 2020 in the next three years hit a new low compared to the
China, which were higher than their global ROI. past five years
Compared to the previous year, more companies Nearly half of the participating companies show
believe that they will see improvement in US-China confidence in employment expansion despite
relations in 2021. Dr. Seyedin said “There is a the fact that China’s economic growth reached
general consensus within the business community an all-time low in nearly three decades in 2020.
that the Biden administration will view the US- Last year witnessed a steady upswing in business
China relation through a different looking glass. environment in South China. However, companies
I predict a rather long honeymoon period within report that rising operation and labor costs as well
which the two sides will have an opportunity as, lack of qualified personnel are three serious
to examine their differences, evaluate what is challenges for development in South China.
important to each side and begin friendly and
mutually respectful dialogue. Dr. Seyedin also said An overwhelming majority of companies stated
“I expect US and China to hit a reset button and that visa and travel restrictions have an adverse
very likely start a new era of cooperation which will impact on their operation. Over 50% of them were
benefit not just US and China but the entire globe.” affected by China’s visa and travel restrictions while
approximately 40% of them were influenced by
Key takeaways of the 2021 White Paper on the American restrictions.
Business Environment in China and the 2021
Special Report on the State of Business in South 2021 White Paper & Special Thank you, sponsors!
China include 94% of American companies see a Report Free Download
bright prospect in China’s market, and none of the Here
companies surveyed showed any willingness to
leave China completely.
China remains the top investment destination by
more than half of the studied companies despite its
decreasing attraction as a manufacturing base. The
study shows a very interesting direct connection
between the reduced number of expatriate
executives in China and the substantial reduction
in very large planned reinvestments. While number
of small, medium and small reinvestment projects
have held steady, and the total amount of planned
reinvestments have stated relatively the same, the
number of very large projects involving 250 million
US dollars or more each have reached the lowest
levels in several years
While a combination of factors including the
coronavirus pandemic severely impacted the
global economy in 2020, only a slight decrease in
actual reinvestment in China was realized. Factors
including huge market potential, preferential
policies and uncertainties of pandemic in other
SOUTH CHINA BUSINESS JOURNAL 10
