[Perspectives] Trump @ China, What Do American Businesses Think?

Perspectives

This is an irregular column. It exists because China is covered constantly and understood, on balance, poorly. The reasons aren't mysterious: Most of the people doing the covering aren't here, and the ones who are tend to write for audiences who aren't. The gap between the coverage and the place is real, and it matters. This column tries to close it, a little. People who are here, who know the environment from the inside, with something specific to say. Better understanding tends to produce better outcomes. We proceed from that.

The Xi-Trump summit ended not too long ago in Beijing. And as I sifted back and forth through Chinese and US coverage of the event, I couldn't help but notice the patterns I'd long since learned to recognize in US media coverage. Now, some context.

It used to be that Americans who have lived in China for a modest amount of time, say, at least five years, had developed an innate filter when it came to consuming Western mainstream media. Most of us could spot the US-side propaganda just within a headline. Nowadays, people who have been here for just a month are able to call out Western narratives just by virtue of arriving in China, and seeing just how immediately stark the contrast is between how China is painted as a caricature of a boogeyman authoritarian state, and the lived reality of clean, safe cities, with a citizenry that is more affronted by a mildly grumpy Didi driver telling you to "hurry up" than the actual institutions that govern the nation.

After a while, Americans (as well as many Europeans and Australians) see that there is a version of the China-US story that plays ad nauseam in Western media. It runs on a familiar script: competition, threat, tension, managed decline. The US either triumphs or is diminished depending on which outlet you're reading. China looms. American companies are quietly packing up. The relationship is, at best, controlled hostility.

So I sat down with Eric Zheng, president of the American Chamber of Commerce in Shanghai. AmCham Shanghai represents roughly 1,000 corporate members across manufacturing, services, and retail, and Zheng has been navigating this relationship from the inside for years, through the tariff wars, and into whatever this current moment becomes. He'd also just returned from a week in Washington, DC, which gave our conversation an interesting double lens: what the people making policy think is happening, and what is actually happening.

What follows is a conversation about what the Beijing summit meant for business on the ground, where the genuine opportunities are, why the story most people are reading may not be the whole one, and why China-US cooperation is more important than ever.

CNS: Eric, thank you so much for making the time. For our readers, could you introduce yourself briefly, and also tell us a little about what the American Chamber of Commerce in Shanghai is, and what it does for those who might not be familiar.

Eric Zheng: Sure. My name is Eric Zheng. I'm the president of the American Chamber of Commerce in Shanghai. The Chamber just celebrated its 110th anniversary last year. We were founded in Shanghai in 1915, making us the third American chamber established overseas – after Paris and Manila. A chamber of commerce is generally an association of businesses that share knowledge, collaborate, and even engage in things like advocacy or business support for overseas companies operating in a foreign country.

Many don't know this, but even in the early 20th century, there were enough American companies in Shanghai to form a chamber. My former employer where I was CEO, AIG, is a good example. AIG was founded in Shanghai in 1919 by C.V. Starr, a young New Yorker who came here to start an insurance agency. So Shanghai is literally part of AIG's DNA. (Copy Editor's Note: American International Group (AIG) is a Fortune 500 company and one of the largest global insurance institutions.)

American companies left China in the 1950s. The Chamber re-established itself in 1987 after the companies returned and has grown ever since. Today, we have about 1,000 corporate members across manufacturing, services, and retail. Most are US-headquartered multinationals, but we also have European companies with substantial US operations. We're very inclusive – if you're a multinational with a meaningful presence in the US, you qualify. Once the COVID-19 hit, the board asked me to step in and run the Chamber. I took on the challenge – with US-China tensions rising, it felt like an important time to help. But honestly, we have a very strong team here.

CNS: The Beijing summit generated quite different narratives depending on where you were reading. Much of mainstream Western media split into two camps: either framing it as a failure for the Trump administration, or painting China as a source of threat and tension. From people actually on the ground here, the read seems quite different. What's the general view from the American business community?

Eric Zheng: In the past few years, the No. 1 challenge for our companies operating in China has been uncertainty in the bilateral relationship. Very consistently, the top concern. With the summit, people were certainly looking at whether commercial deals would be signed. But for our companies, what we were really looking for was stability. That's the No. 1 outcome.

The two leaders met in Beijing. President Trump brought a large delegation of US executives. That alone was already very positive news. But beyond that, the two sides agreed on a new framing: what they're calling a "constructive strategic stability relationship." That's significant. It moves away from the language of "strategic competition" (the previous official US characterization of the relationship as a rivalry between great powers) toward "strategic stability." We were very happy to see both sides adopt it.

For our companies, that framing was probably the most important outcome. Certainly, having more concrete trade deals wouldn't hurt. The two sides didn't really have time to sort out all the details. But deals have been, or will be, announced: 200 Boeing planes, soybeans, and some licenses to be issued to US companies operating here. All very positive.

CNS: You recently returned from a week in Washington, DC. What were you hearing there, and how did it contrast with the perspective of people based here?

Eric Zheng: We spent a week meeting with policymakers, including Senator Steve Daines from Montana, who recently led a bipartisan Senate delegation to China and met with some senior leaders here. Having more of those exchanges is very helpful. Senator Daines is certainly much better informed than many of his colleagues right now.

I was on a panel at a two-day China conference, and the contrast was striking. Our group, myself, the AmCham China president from Beijing, and a representative from the EU Chamber in China, all shared what you might call the on-the-ground view. While acknowledging the geopolitical challenges, we also talked about the potential for the two sides to work together. Others throughout the conference focused far more on competition and national security considerations. It was quite a contrast. Once people actually visit China, they tend to come away with a much more nuanced understanding, rather than a black-and-white view.

CNS: Trump came to Beijing conciliatory and deferential in a way that surprised a lot of observers, given the tone of his first administration and even the early months of this one. What do you make of that shift?

Eric Zheng: I'm not sure of the motives, but I do agree the summit went very smoothly, partly because of mutual respect. That's precisely one of the conditions China has always put forward: mutual respect as a starting point. I think the two leaders have finally reached that understanding.

I'd call it almost an inflection point. The US is now attaching the kind of respect and importance to this relationship that China has long been asking for. The atmosphere in Beijing was very, very positive. There are certainly many structural issues and differences between the two countries, but you need to start somewhere. Mutual respect is a very good place to begin.

CNS: Both leaders signaled a desire to move beyond adversarial framing toward cooperation. Where do you see the most meaningful opportunities?

Eric Zheng: There are many. One growth area that doesn't get enough attention is healthcare. Specifically, the opportunity for US big pharma to work with Chinese early-stage drug developers. There are many of these companies here, very innovative, and very capable at early-stage R&D (research and development), including Phase-1 and Phase-2 clinical trials (the initial rounds of human testing to establish safety and effectiveness). They can do this at significantly lower cost and in a much shorter timeframe.

But they need large pharmaceutical companies like Johnson & Johnson or Pfizer to take them to the next level: Phase-3 and Phase-4 trials (the large-scale studies required for full regulatory review) and ultimately FDA approval (the US regulatory clearance required to bring a drug to market). This would be a genuine win-win partnership. If you take the politics out of it, it's a perfect example of the two sides working together for global public health.

There are also strong opportunities in agriculture, food and beverage. One interesting example is pet-related products. Pet ownership has grown rapidly in China, especially among younger people. Pets are now treated as family members. As a result, US pet food is doing very well, as are pet nutritional supplements and even pet medicines.

Mars, for example, is one of our members. Their pet food division is growing very quickly in China. That's just one illustration of how US companies can tap into new lifestyle trends.

Another area is coffee and café culture. Even though companies like Starbucks face intense competition, the overall market is still growing. Success now depends on finding the right niche and strategy.

But one thing I should mention is China is no longer the market of 20 years ago, where you could simply copy-paste your global model and expect success. The competitive landscape has changed dramatically. Innovation, differentiation and speed are essential.

Many opportunities. If you look at the negative list, it's getting shorter. There are no manufacturing sectors left on it, meaning manufacturing is fully open. In financial services as well, many segments are now open – foreign firms no longer need joint ventures and can hold 100 percent ownership. J.P. Morgan, for example, has obtained all the major licenses it needs.

So access is no longer the main bottleneck. The bigger challenge now is commercial: how to succeed competitively.

For example, AIG used to be very large in the US and around the world, but in China it was pretty small compared with local peers. So how American companies or more broadly, multinational companies succeed in China will very much depend on their strategies. So localization will be a key.

Our members, American companies, tell us they are ahead of local peers in only two areas: product development and product quality. The rest of the categories we are all behind, particularly speed to market. We're also way behind in digital strategy and the ability to use technologies like AI. So American companies and multinational companies have to adapt in this market in order to be competitive commercially.

So the opportunity is there, but winning will depend on how well companies adapt, localize, and execute commercially – not just on whether the door is open.

CNS: On the automotive sector: Is there a realistic collaboration model, or is it as zero-sum as the political conversation suggests?

Eric Zheng: It's already happening, mostly with European automakers. Volkswagen and Mercedes-Benz have both concluded that in the EV space, Chinese companies are significantly ahead. Traditional carmakers are very strong in internal combustion engine vehicles, but in EVs (electric vehicles), which represent an entirely new platform and technology, companies like Volkswagen are now teaming up with Chinese partners. Volkswagen has set up a JV (joint venture, a shared company between two partners) in Hefei, Anhui Province, to develop new EV models based on Chinese technology for export to other markets. European carmakers are already doubling down on this strategy.

US automakers are not there yet, partly because of the geopolitical complications. They're still largely on the sideline. But from a purely commercial standpoint, it makes perfect sense for them to collaborate with Chinese EV makers, who are genuinely very innovative. Companies like BYD are very, very good. CATL , the world's largest EV battery maker, is also very interested in working with US automakers. There have been technology licensing discussions with companies like Ford for quite some time. Battery cooperation is already starting to happen. That's a good sign.

CNS: Let's shift to a slightly more provocative but nuanced question. General media coverage of China's economy tends to focus heavily on negative themes. And yet, we still see foreign companies entering this market, and expanding here. To a layperson, consuming mostly mainstream media, it might look irrational. Are these companies insane – or do they know something the average person doesn't?

Eric Zheng: Companies are here in China for a reason. They see China as a strategic market both now and for the long term. It's still a growth market. Yes, growth rates have slowed from the double-digit era, but the absolute size of the market and its potential remain enormous.

There are two main dimensions:

1. "China for China."

Many companies are here to serve the domestic market – whether B2C or B2B – because household consumption and business demand are large and still have room to grow.

2. China as a manufacturing and supply-chain hub.

China remains a manufacturing powerhouse. Its manufacturing ecosystem is second to none. It's hard to imagine another country matching that scale and sophistication within 5-10 years. So companies are also here to source from China and to manufacture here.

Those are the two fundamental reasons why we continue to see American companies entering or expanding in the Chinese market, despite what people may read in overseas media.

Some companies are quieter about it now, but they are still here. Our members, by and large, are not "leaving." Western media may focus more on the negatives – and there are real risks, as there are in every country. Every business decision is about balancing risk and reward. As long as the expected reward outweighs the risk by a sufficient margin, companies will take calculated risks to achieve commercial returns.

CNS: Agriculture has been one of the most visible fault lines in this trade relationship. Where does that stand now, given the new commitments out of Beijing?

Eric Zheng: Agriculture is the clearest illustration of complementarity between these two economies. The US is one of the largest exporters of agricultural products. China is one of the largest importers. That relationship is almost structural.

We've been working closely with the USDA and the local Agricultural Trade Office to support American companies accessing this market. Our focus is on giving smaller businesses and trade associations a platform, because the big players will capture enormous trading volumes through large state-owned buyers on the Chinese side. Making sure SMEs (small and medium-sized enterprises) are part of this rebound matters.

CNS: As Xi's visit to Washington approaches and these new mechanisms start to take shape, what else gives you reason for optimism?

Eric Zheng: One area I care deeply about is people-to-people exchange, particularly students. Right now, we have fewer than 2,000 American students studying in China, and roughly half of those are with NYU Shanghai. Compare that to approximately 300,000 Chinese students currently in the United States. That imbalance matters for the long term.

Young Americans are genuinely open-minded, curious about the world, connected through the internet and social media. When they come to China, they leave with a far more nuanced understanding than anything they'd get from media coverage alone. We need more of that exchange, and I think the next generation on both sides has more in common than the political narratives suggest.

On the broader outlook, I feel more confident now than I did a year ago. With the Beijing summit behind us, I believe that for the remainder of this administration, we'll have a relatively stable period in the bilateral relationship. Stability is foundational. With it, companies can plan for the long term, rather than constantly reacting to geopolitics. That's what our members are asking for above everything else.

The US is celebrating its 250th anniversary this year. I recently spent a few days in Suzhou for the APEC (Asia-Pacific Economic Cooperation) ministerial meetings, and was reminded that Suzhou has a history of 2,500 years. The US is one-tenth of that. There is a lot of history and culture here worth sharing. And on the US side, the innovation ecosystem is genuinely extraordinary. The US is very good at going from zero to one: pure invention. China is very good at going from one to one hundred: application, manufacturing, scale. That's not a competition. That's a partnership waiting to happen.

CNS: This is really interesting, and I want to reflect back on something you just said because it may surprise some of our readers outside China. There's a prevailing narrative that China's main problems for foreign businesses are IP protection, market access, and the fairness of the business environment. I'm not saying China is "wide open," but you've essentially said that regulatory barriers and market access have improved significantly, and that some companies can no longer blame only market access. Their real challenges are now strategy and adaptability. Is that fair?

Eric Zheng: Yes, that's broadly correct.

If you talk to some people in Washington, DC, many old preconceptions prevail. Most people may assume you still need a joint venture to operate a foreign company in most sectors. That is no longer true. For most industries – including financial services and all manufacturing – you don't need a JV anymore. You can own 100 percent.

That's one misconception we can easily clear up.

On IP, there are still challenges. Enforcement can be uneven. But the overall framework – laws, regulations, institutions – has improved significantly.

And this isn't just an anecdote, but is also being reflected in broad research sentiment. Our survey data shows that our members have seen major improvements in IP protection over the years. One reason is that Chinese companies themselves now create IP and want it protected. We now share a common interest in strengthening IP protection.

So, yes, IP enforcement isn't perfect, but it's far from the "Wild West" image some people still have. And we do have data points from our surveys that show meaningful progress.

CNS: Thank you very much for your time. Before we end, any final thoughts?

Eric Zheng: If we had one request, it would be this: that both governments continue to work together to manage their differences. The US and China have highly complementary economies. It is in everyone's best interest for them to find ways to work together and grow together.

China is not going away; it will remain the world's second-largest economy. The US is not going away, either. The US must continue to find ways to work with China despite differences in political systems, ideology, and development models.

The two have to work together, on AI, on climate change, and many other pressing issues. On the Chinese side, the state apparatus has been very clear in its desire to work together with, and cooperate with, the US. And now with this current administration, it looks like the US is extending these same invitations to China for continued talks. We hope for this to continue on the positive trajectory that we are beginning to see.