U.S. Companies in China Struggled for Profits, Even Before Outbreak

March 10, 2020

The outbreak of the Coronavirus in China has American companies that do business in the country struggling for profits. While the virus has exacerbated the situation, a new snapshot into business conditions in the country shows that these companies were poorly positioned already.

The American Chamber of Commerce in China released its annual snapshot of business conditions based on a survey conducted in October and November last year, just months before the outbreak began.

Just 61% of businesses described their operations as “profitable,” an eight-point decline from the year before. The portion of businesses that feel they are just “breaking even” was up seven points. Business conditions were deteriorating and China’s economy was slowing even before the virus. The outbreak will only make matters worse, with some U.S. companies warning that they could lose as much as half their annual revenue in China if the epidemic continues into the summer.

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