China no longer top destination for foreign investment 

An increasing number of American businesses say they feel unwelcome in China after the country’s government began a crackdown on monopoly pricing and corrupt business practices, according to a new survey. The wide-ranging investigations are also perceived to be unfairly targeting foreign companies.

AmCham said that the survey showed “an increasing sense of pessimism among foreign multinational companies in China” and warned that China could “permanently lose its luster as a desirable investment destination.”

Concerns over China’s slowing economic growth, foreign policy tensions, increasing labor costs and the lack of transparency in the system for foreign investors, have led to a slowdown of investments in China from North America, Europe and Japan, according to the Journal.

The European Chamber of Commerce said in August that it heard “alarming” accounts from European companies of intimidation tactics used by Chinese officials to force foreign-owned companies to accept the penalties handed out by Chinese authorities without being allowed full hearings in court, according to the Journal.

Chinese officials have reportedly defended their actions saying that the crackdown targets both domestic and foreign companies.

About seven years ago, China was the No. 1 investment destination for a majority of U.S.-based companies. However, this year’s survey showed only 20 percent of respondents were interested in investing in China .

 

Source: ibtimes

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