Critical US visit to China

US Commerce Secretary Gina Raimondo is visiting the country at a time when US companies doing business in China are raising concerns about the investment environment due to growing geostrategic competition and political tensions between the two countries.

Minister Raimondo is expected to arrive in China today for a four-day visit and will hold talks in Shanghai and the capital Beijing.

Raimondo, who will meet Chinese Communist Party (CCP) Secretary Chin Cining and representatives of the American Chamber of Commerce (AmCham) in Shanghai in Shanghai, is expected to meet with his counterpart Wang Vintao and other officials in Beijing.

The US minister’s visit coincides with growing economic competition between the two countries, especially in the field of technology, and global geopolitical tensions between the two countries by US investors doing business in China.

THE BUSINESS WORLD IS CONCERNED

The “China Business Climate Survey” conducted in March by AmCham, which has more than 1,000 registered members in Shanghai, China’s commercial and financial hub, revealed for the first time in 25 years that most companies Americans do not view China as an “investment priority.”

While 45 percent of the companies that participated in the survey ranked China as one of the “top three countries to invest in,” 55 percent did not.

On the other hand, 45 percent of companies said that the business environment in China is “deteriorating” and that the most important problem is “rising tensions between the US and China.”

Raids on American companies

During his visit, Minister Raimondo is expected to raise concerns with his Chinese counterparts about barriers to market access by US companies for data security and national security reasons.

As Chinese security units raided the offices of US-based international auditing and consulting firms such as Bain & Co, Mintz and Capvision and conducted investigations, it raised concerns that the border between “state secrets” and the open market information necessary for investment decisions was blurred in the country.

Raids were carried out in May on the Beijing office of auditing firm Mintz, the Shanghai office of consulting firm Bain&Co, and the Shanghai, Beijing, Sucou and Chinjin offices of market research firm Capvision.

Mintz, one of the companies investigated, was fined $1.5 million on August 22 for “performing unapproved statistical work.”

CHIP WAR

On the other hand, the mutual restrictive measures caused by the growing competition between Washington and Beijing in the field of advanced technology, especially in semiconductors, also raise concerns in the business environment.

China has banned the sale of chips and integrated circuits to Chinese companies carrying out critical infrastructure projects for the company, following a cybersecurity investigation against US microchip maker Micron Technologies.

Raimondo is expected to point to the Micron ban as an example and also raise market access issues for US companies.

On the other hand, the United States has recently revealed its intention to hinder China’s technological development in the industry with export controls and technological restrictions on Chinese companies in the chip industry.

With a presidential executive order signed on August 10, US President Joe Biden placed restrictions on venture capital and equity investments by US companies in China in three critical technology areas: semiconductors and microelectronics, quantum information technology, and certain information systems. artificial intelligence.

The decree, which coincides with the anniversary of the Chips and Science Law passed in 2022, demonstrates Washington’s insistence on curbing China’s technological capacity in the chip industry with investment controls following export restrictions.

FOURTH VISIT

Raimondo’s visit will be the fourth high-level visit by Biden administration officials to China this year.

Following US Secretary of State Blinken’s visit in June, Treasury Secretary Janet Yellen and Special Representative for Climate Change John Kerry visited the country in July.

In addition, former White House National Security Adviser and US Secretary of State Henry Kissinger also visited Beijing in July and was received by Chinese President Xi Jinping. (AA)