GUANGZHOU, June 20 (Xinhua) -- U.S. firms are not pulling out of China under trade tensions as the country's consumer market is just too big to lose out on, said Harley Seyedin, president of the American Chamber of Commerce (AmCham) in South China.
"I don't know a single company or member who has left China," said Seyedin, in an interview with Xinhua.
China's economy is growing at a relatively fast pace, creating consumer demand and investment opportunities, Seyedin said.
"You have to build new facilities to keep up with the demand, otherwise you can lose market share. Once you lose it, it's hard to get it back," said Seyedin, noting that certain U.S. firms operating in China are losing market share to European competitors as a result of the trade frictions.
A study by the chamber showed that its members, mostly foreign-funded multinational companies, have increased their 2019 reinvestment budgets in China by a whopping average of 37.9 percent over 2018.
The reinvestment from profits is not reflected in the foreign direct investment data, which is proof that foreign companies are bullish on the long-term growth of consumer demand in the country, Seyedin said.
As China's consumer market evolves, foreign companies operating in the country have also been shifting their model from "made in China" to "made for China," he said, noting that some 78 percent of the firms now produce goods and services in China for the local market, while the proportion was less than 23 percent in 2003.
The shift of production lines outside China is not as easy as it may sound, as the process takes a lot of time, investment, and employment training, Seyedin noted.
"It's not something you can do overnight," he said.
China has sophisticated production lines for high-tech products, and it may take years or even decades to set up such lines elsewhere.
"The question is, are you really going to save money in doing so?" Seyedin said.
While some companies did hold off big investment projects because of uncertainties brought by the trade tensions, they still proceeded with reinvestment plans of smaller budgets, according to Seyedin.
"Uncertainty is the enemy of investment so people would wait, but that does not mean they are not going to invest," he said.