Yesterday the American Chamber of Commerce in China, located in Beijing, released its annual White Paper on the business environment in China. This lengthy document analyzes the evolution of Chinese policies across a range of issue areas and regions and the economic environment for American firms operating in China. AmCham uses a detailed survey of its members as well as information from additional research and interacting with the Chinese government. The White Paper contains both analysis and specific policy recommendations.
The US-China Business Council serves mainly as a business association representing a wide swath of international companies that do business in China, but it also provides customized consulting for individual members. Most of the Council's members are also AmCham members. Although the Council does not issue an annual white paper, it does release occasional reports and its staff testifies before Congress and privately offers advice to the US executive branch and the Chinese government.
Given their overlapping constituencies, it is somewhat surprising that the two organizations recently have struck different notes on China. Both organizations identify positive and worrying trends, but their emphasis differs. AmCham's phrasing is: Our companies are doing well, but the policy environment is worsening. By contrast, the Council's consistent message is: There are some worrying signs about the policy environment, but overall things are going in the right direction in China. AmCham seems to be ringing alarm bells, while the Council is tooting a small bicycle horn.
The White Paper shows that American companies are still doing extremely well in China. 78% of respondents said they are profitable or very profitable, compared to only 71% in last year's survey. Most firms say their incomes have gone up subtantially. However, arrayed against these positive macro trends are worrying policy developments that are presenting severe challenges to their members. Over a quarter of respondents say that "Indigenous Innovation" policies are negatively impacting their business. Many believe that the protection of intellectual property rights is not improving, and opportunities for government procurement are threatened by various buy-local incentives or even orders.
Given these challenges, AmCham makes a case for more forcefully raising these issues with Chinese officials and offers a long list of suggested reforms.
The US-China Business Council comments about worrisome trends in China's business climate, including reports on Indigenous Innovation. Many of these have extensive details about policies that may be harmful to US interests, but these reports do not strike a worrying tone. They appear to be intentionally dry, fact-based descriptions of the current scene and avoid preaching as much as possible. At most, they mention "international best practices" China should seek to follow. But otherwise, they are highly respectful and avoid being seen as emotional or critical.
A good example is a paragraph from the executive summary of a recent report on indigenous innovation policies:
The Council also appears to believe that the key to responding to the challenge of China's policies are not pressuring China to change but rather having the US government adopt policies that promote innovation and the competitiveness of US industry at home and abroad. The Council also released this month a 28-page report, "China and the US Economy: Advancing a Winning Trade Agenda, A Guide for the 112th Congress." No where in the report is there a mention of Indigenous Innovation or many of the other concerns that appear in AmCham's White Paper. The report highlights the continued prominence of American manufacturing, the small percentage of American manufacturing that has moved to China, and China's much lower per capita income.
The tone from AmCham now sounds more similar to that of the U.S. Chamber of Commerce, based in Washington, D.C. The US Chamber represents a wide variety of corporate interests, including firms that doing well in China and those that see China as a competitor. For many years, AmCham sounded more sympathetic to official China, but that phase seems to have passed. It is now the Council that looks distinctive among this group.
None of the above is meant to pass judgment on either position, just to note the apparent differences in approach. Given that AmCham and the Council have overlapping membership, one wonders what is the source of the difference. Perhaps it is that the Council is headquartered in Washington, DC (but with offices in Beijing and Shanghai) and needs to interact more with Congress. Or perhaps this difference reflects the contrasting styles of their leaders, John Frisbee in the case of the Council and Chris Murck in the case of AmCham. Or perhaps we have a game of good cop-bad cop being played.
I have no idea which it is, but look forward to continuing to engage in chamber-ology -- searching for clues in their respective statements -- in the years ahead.
None of the above is meant to pass judgment on either position, just to note the apparent differences in approach. Given that AmCham and the Council have overlapping membership, one wonders what is the source of the difference. Perhaps it is that the Council is headquartered in Washington, DC (but with offices in Beijing and Shanghai) and needs to interact more with Congress. Or perhaps this difference reflects the contrasting styles of their leaders, John Frisbee in the case of the Council and Chris Murck in the case of AmCham. Or perhaps we have a game of good cop-bad cop being played.I like it very much, thank you
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Posted by: 运动鞋 | June 01, 2011 at 11:14 PM