COVID-19 has shifted U.S. business attitudes toward China, according to a survey conducted this spring by the American Chamber of Commerce China and the American Chamber of Commerce Shanghai. 

The survey was conducted from March 6-13, the early days of the COVID-19 outbreak in the U.S. It was intended as a follow up to work the groups did last fall in the midst of the trade war between the U.S. and China.

In October, 70 percent of U.S. companies surveyed said that cutting ties with China was impossible, while only 44 percent reported feeling that way in March. In addition, about 25 percent said that COVID-19 would speed up the break with China and they planned to shift sourcing activities as a result of the pandemic.

While some companies planned to shift sourcing away from China, 68 percent of respondents said they expect supply chain operations in China to return to normal within 3 months, and 96 percent of respondents expect to return to normal in 3 to 6 months. With the economies in both countries now in the process of reopening, it seems like business as usual could resume in the coming months, barring another virus outbreak in either country.

Further, just because companies reported that it would be possible to break ties with China does not mean they actually will. In the short term, more than 70 percent of respondents said they have no plans yet to relocate production, supply chain operations, or sourcing outside of China because of COVID-19.

“Our survey results show that companies are considering adjustments to their business strategy, but there is no mass exodus as a result of COVID-19,” Ker Gibbs, President of AmCham Shanghai, told National Review. “Still, there is no escaping the fact that the current crisis adds a new and unwelcome dimension to the conversation about decoupling. This will be part of the discussion for months to come.”

A follow-up survey conducted in May reported that travel restrictions were among companies’ biggest concerns, with 90 percent citing it as an issue. The biggest hurdles reported involved allowing senior executives based in China to return there and allowing Chinese staff to enter the U.S.

Continued travel restrictions will likely change the way that the U.S. does business in China, with less investment in office space and more emphasis on telecommuting.

“We already allowed employees the flexibility to work from home pre-Covid-19 but will likely downsize office space as leases expire to reflect lower demand for occasional face-time at the office,” Barron’s reported.

For more surveys and reports from the American Chamber of Commerce China, visit amchamchina.org.


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