A survey by the American Chamber of Commerce in China (AmCham China) has found the impact of the Covid-19 outbreak on its members has been “significant”, with travel disruptions and reduced staff productivity presenting the biggest challenges.
The flash survey, completed by 169 member companies last month, found that nearly one-third of respondents are facing increased costs and significantly reduced revenue.
Survey respondents represented large, medium and small-sized enterprises, including many with global operations and some with operations in Hubei, China and/or provinces surrounding the centre of the Covid-19 outbreak. Industries covered four main sectors: technology and other R&D-industries, resources and industrial, consumer (product and services), and services. AmCham China has members operating in the apparel and textile sector.
There remains a delicate balancing act between containing the epidemic and restarting the economy, but the effects of delaying a return to normal operations could be costly: nearly half of respondents expect 2020 China revenue to decrease if business cannot return to usual before 30 April, while close to one-fifth say 2020 revenue will decline more than 50% if the epidemic extends through the end of August.
In terms of economic outlook, nearly one-third of respondents expect a return to normal business operations by the end of March, while 12% project delays to extend through the summer. Meanwhile, more than half of respondents say it is too soon to determine the estimated cost of delays, though about 10% report they are losing at least half a million RMB per day.
“AmCham China member companies, like much of society here, face a large number of uncertainties in combating Covid-19,” says AmCham China chairman Greg Gilligan. “There is, in the short term, a clear and significant negative impact to member company operations, through travel disruptions, reduced staff productivity, increased costs, significant drops in revenue, and more.
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By GlobalData“However, for most of our members, it is still too early to tell how significant the long-term impact will be. 43% of respondents say it is too soon to determine Covid-19’s 2020 impact on market growth, half feel it is too early to determine impact on still-planned investments, while one-quarter report plans to maintain existing investment plans.”
Around 44% of those surveyed say uncertainty around the epidemic has negatively impacted their outlook regarding the US-China bilateral relationship, while 49% hope the Chinese government will provide tax alleviation to help foreign business.
Additionally, more than one-third are seeking clear, consistent policies, while 35% ask that transparency be prioritised.
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