Page last updated at 09:26 GMT, Monday, 22 March 2010

US business feeling unwelcome in China, says survey

Google China
Google's problems with China have unsettled US business

US companies feel increasingly unwelcome in China because of what they see as discrimination and inconsistent legal treatment, according to a survey.

The American Chamber of Commerce in China found that 38% of members felt unwelcome, up from 26% last quarter.

AmCham-China found that inconsistent regulation and judicial treatment topped the list of concerns.

It follows alleged cyber attacks on Google, and Chinese claims that the firm is too close to the US government.

Companies surveyed by the organisation cited claims that Beijing wanted to squeeze foreign technology companies out of the multi-billion dollar market for selling computers and office equipment to government departments.

New rules stipulate sellers of high-tech goods must contain Chinese intellectual property as part of an "indigenous innovation" campaign, in order for them to be included in a government procurement catalogue.

"The survey shows that US companies believe they face product discrimination in state-owned enterprise purchases, as well as in government procurement," the survey said.

Of the American technology companies surveyed, 57% said they expected the preferential purchasing policy to have a negative impact on their operations in China while 37% said they were already losing sales.

Member-companies believed some policies in China were "increasingly restrictive and protectionist" which could limit foreign participation in the world's third largest economy, the survey said.

The survey was released as the trial opened in Shanghai of four employees of Anglo-Australian miner Rio Tinto on allegations of bribery and espionage.

The defendants were arrested last July during contentious iron ore contract negotiations that later collapsed.

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