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U.S. Businesses Less Optimistic about Prospects in China

U.S. Businesses Less Optimistic about Prospects in China

A new report from the American Chamber of Commerce in Shanghai says that American businesses are lowering their outlook for their prospects in China amid increasing competition, costs and regulation.

The report, which was released during an official visit to the U.S. by Chinese Vice

A new report from the American Chamber of Commerce in Shanghai says that American businesses are lowering their outlook for their prospects in China amid increasing competition, costs and regulation.

The report, which was released during an official visit to the U.S. by Chinese Vice President Xi Jinping, found that nearly 80 percent of responding U.S. companies see their China business as profitable. However, fewer companies are reporting increasing revenues or profit margins, The Associated Press reports.

“Although U.S. companies are generally optimistic about the future, they feel less bullish about their business prospects going forward than in the previous year,” the report noted, according to the AP.

Specific findings from the report included 90 percent of responding companies felt China was losing its cost advantage against others. Some of the major obstacles cited as hindering business in China were problems hiring and retaining qualified employees, as well as regulatory challenges.

According to Reuters, property rights is another major issue, as China campaigned against violations of these rights in 2010, but progress on the issue has been limited. Chinese Foreign Ministry spokesman Liu Weimin told Reuters that he hopes foreign invested companies would understand such efforts will take time.

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