US Executives Fret About Rising Costs, Slowing Growth in China

US executives doing business in China are worried about rising labor costs, slowing growth and unfair treatment from Beijing but continue to see the country as one of their critical markets, according to a recent survey conducted by AmCham China.

Businesses in China have already had to cope with a tripling of monthly minimum wage since 2001. It’s expected to double again by 2015 at its current 13% annual pace of growth. Add to the surging labor costs the difficulty of recruiting quality talent and executives face a difficult climate for justifying new investments.

The difficulty is exacerbated by the the discriminatory issuance of government licenses needed to do business in China, unreliable internet connections, lack of effective protection for intellectual property, and opacity of government policies.

Despite these problem, over 80% of AmCham survey respondents have plans to increase investment in China — a market few global US firms can afford to ignore regardless of the number of frustrating obstacles they face for the simple reason that for the forseeable future China will continue to be the main engine of global economic growth.