Addressing A Complex Business Environment amid US-China Trade War

On May 30, 2018, DaoHe president Jane Zhang was invited to speak at the launch event of the 2018 AmCham China White Paper on “Addressing A Complex Business Environment”.  

In talking about the complex business environment facing multinationals in the period of tension in the US-China trade relations, Jane illustrated her approach to analyze the complex situation. She categorized key players into three groups, namely Chinese government, US government (executive branch and the Capital Hill) and very importantly, the US companies, and shared her frontline experiences and observations on the three groups’ viewpoints and perceptions.

"To understand the situation, we need to know not only what the three groups are thinking, but also what has led to their current thinking, so that we can obtain a glimpse of where the situation is heading,” said Jane.

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After reviewing the governments’ thinking on the US and Chinese side, Jane focused on the critical role of US companies in the US-China trade and investment relations. She highlighted a phenomena that in many US companies, the local team in China would mostly talk about their commitments and other “good news” with the Chinese government while leaving the discussion of challenges in operating environment and most of the complaints to headquarters folks to convey to Washington D.C. When this became a common practice for most companies for an extended period of time, the two governments end up hearing quite different things from the companies, which helps create big perception gap between the two sides. This further aggravates misunderstanding between US and Chinese government.

When asked what companies can do, Jane encouraged multinational companies to help increase transparency by providing full picture of their operations in China, both challenges and also opportunities, to both the US and Chinese government. On how to improve freedom-to-operate in the China market, Jane emphasized the importance for companies to create solutions together with Chinese government stakeholders and provided cases studies to illustrate the approach.