US companies say trade war has harmed business in China: survey

US companies say trade war has harmed business in China: survey
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More than 8 in 10 U.S. companies with business in China say President TrumpDonald John TrumpMarine unit in Florida reportedly pushing to hold annual ball at Trump property Giuliani clashes with CNN's Cuomo, calls him a 'sellout' and the 'enemy' Giuliani says 'of course' he asked Ukraine to look into Biden seconds after denying it MORE’s trade war with Beijing has hindered their operations in the country, according to a survey released Thursday 

Corporations affiliated with the U.S.-China Business Council (USCBC), a nonprofit promoting commerce between the world’s largest economies, reported a steady stream of profits and commitment to operating in China in the group’s annual member survey.

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But U.S. firms with operations in China said the mounting costs of Trump’s trade war have dampened profits, squandered sales and raised costs for their businesses in the country.

Of the 100 businesses polled in the USCBC survey, 97 percent said they expect to turn a profit in China, and 46 percent said their operations in the country would be more profitable than in other foreign markets. Even so, 26 percent of firms said they expected their revenue from China to decline, up from just 9 percent in 2018.

Businesses cited Chinese tariffs on U.S. goods as the top reason for lost sales, with 49 percent blaming Beijing’s import taxes on $60 billion in American products as their top threat. Roughly a third of businesses said Trump’s tariffs on $250 billion in Chinese goods cost them sales in 2019.

The survey comes as Trump faces growing pressure to strike a deal with China after more than a year of trade tensions have spurred fears of an impending recession ahead of the 2020 election. 

In the two months since the survey was conducted in June, a steady stream of lackluster economic data and a massive escalation in trade tensions have spiked the odds of a recession within a year.

New tariffs are set to go into effect Sunday on much of the roughly $300 billion in Chinese imports not yet targeted by Trump with additional import taxes, with the remainder taking effect on Dec. 15. After China responded with new tariffs on $75 billion in imports from the U.S., Trump hiked the tariff rates on current and proposed taxes and ordered U.S. business to leave China.

Trump has little, if any, power to command U.S businesses to cease operations in China, and American companies indicated in June they have no plans to leave.

In the survey, 87 percent of companies said they have no intention to pull out of China, and 66 percent of firms said they were optimistic about their business prospects in the country, a 9 percent decline from 2018.