U.S. business lobby survey warns of China protectionism

Wed Feb 11, 2015 2:00am EST
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BEIJING (Reuters) - China's regulators are targeting foreign firms, a majority of respondents said in a survey by an American business lobby, citing protectionism among the top concerns for their operations in the world's second largest economy.

Fifty-seven percent of the 477 respondents included in an annual survey by the American Chamber of Commerce in China said they believed recent government investigations "singled out" foreign companies.

The survey results, published on Wednesday, also said increasing protectionism had become the fifth greatest concern for businesses in China for the first time since 2010.

Labor costs, unclear laws and regulations, and shortages of qualified staff and managers, remained atop the list of business challenges.

"There are concerns that China will take an approach, that when the economy slows down, they become more protectionist," Chamber chairman James Zimmerman told reporters.

On Monday, U.S. chipmaker Qualcomm Inc agreed to pay a $975 million fine, the largest in China's corporate history, ending a 14-month government investigation into anti-competitive practices.

In recent months, four international business lobbies have raised alarms over how China's antitrust regulators carried out investigations. At least 30 overseas firms, including U.S. software giant Microsoft Corp and South Korea's Samsung Electronics Co Ltd, have come under scrutiny.

The National Development and Reform Commission (NDRC), which conducted the Qualcomm investigation, has defended its practices and said it does not target foreign companies.

Cyber security, the risk of intellectual property leakage and data security threats were greater in China than in other markets, according to 60 percent of survey respondents.   Continued...

A Qualcomm sign is pictured in front of one of its many buildings in San Diego, California, in this November 5, 2014 file photo.      REUTERS/Mike Blake/Files