- More companies report significant revenue decline and drop in demand, as three-quarters hold a pessimistic outlook towards economic growth.
- But close to half expect a return to normal operations within a month, with more companies now pledging to maintain planned investment.
The American Chamber of Commerce in China (“AmCham China”) today released the results of a second Flash Survey that evaluates the impact of the COVID-19 outbreak on its member companies. With almost 120 companies responding to the survey, these results continue to provide invaluable insight into the ongoing impact on American and multinational companies in China, as well as providing the US and Chinese governments with suggested policy support.
Disruption caused by the COVID-19 pandemic has continued to escalate in China. Roughly half of the surveyed members say they are experiencing significant revenue declines, compared with 28% last month. Meanwhile, 39% of companies report a drop in demand for their products, up 6 percentage points from last month.
As the fallout from the epidemic has become clearer since last month, more members now express a pessimistic outlook. 57% of respondents said they expect 2020 China revenues to decrease if business cannot return to normal before April 30 – up from 48% the month before – while 60% (up 10 percentage points month-on-month) said 2020 revenues will decline anywhere between 10% and 50% or more if business cannot return to normal before August 30.
“Our member companies are still wrestling with challenges brought by the epidemic, and there’s now concern about the global impact,” said AmCham China Chairman Greg Gilligan. “Since our last survey, this has now become a worldwide pandemic and close to half of the companies said the global spread of the virus would have a moderate-to-strong impact on their China operations. But the views aren’t all grim: nearly a quarter of our companies expect a return to normal business operations by the end of April, while 22% have already resumed normal operations, and 40% report they will maintain previously planned investment levels, up significantly from last month’s survey.”
The survey also found:
- The Consumer and R&I industries are most pessimistic about COVID-19’s impact on 2020 market growth, with 38% from both sectors expecting a decrease of 50% or more.
- Respondents are most optimistic about the prospects for further reform (42%) and market opening (39%) efforts; 76% of respondents hold a pessimistic outlook towards economic growth in light of the COVID-19 pandemic.
- As of March 13, nearly one-fourth of respondents say 100% of staff continue to work from home; 35% report over half of employees have returned to the office.
- Companies would like to receive commercial support from the US government, including advice on business opportunities and support understanding COVID-19-related business policies, as well as guidance on Phase One trade deal implementation; respondents continue to seek actions from the Chinese government regarding tax alleviation and clear, consistent policies.
- 87% of surveyed companies have provided some form of assistance to fight the COVID-19 pandemic, a 6pp increase from last month.
This Flash Survey was conducted between March 14 and 18, 2020, and 119 member companies completed the majority of the questions. Survey respondents represent large, medium and small-sized enterprises, including many with global operations and some with operations in Hubei, and/or provinces surrounding the center of the COVID-19 outbreak. To download the full report, please click the button below.
For more information, please contact:
Mark Dreyer, Marketing & Communications Director, AmCham China