US firms’ confidence in China hits highest since 2021, AmCham survey finds

American companies operating in China are more optimistic about their business prospects than at any point in the past five years, as an easing of trade tensions and high-level diplomatic engagement between Washington and Beijing reshape the commercial landscape, according to a survey released on Thursday.

The American Chamber of Commerce in Shanghai's 2026 China Business Report found that 58 percent of respondents were optimistic about their five-year outlook in China, up 17 percentage points from a year earlier. The rebound ends a four-year stretch of historically low confidence and marks the highest level of optimism since 2021.scmp+2

Some 78 percent of companies surveyed said their China operations were profitable in 2025, the highest proportion since 2019. Investment sentiment also improved, with 28 percent of respondents reporting they increased investment in China last year — the highest share in four years.businesstimes+2

Trade Tensions Give Way to Competitive Pressures

For the first time since 2022, US-China tensions were no longer the leading concern among American businesses in China. Instead, competition from Chinese domestic firms emerged as the top challenge, with 68 percent of respondents citing it among their three biggest business concerns, up five percentage points from the prior year. By comparison, 53 percent cited US-China tensions, down 13 percentage points.businesstimes+2

"There has been a mood shift among our members," said Jeffrey Lehman, chairman of AmCham Shanghai, according to Reuters. He noted that last year's survey was conducted during a period of renewed trade hostilities, while this year's followed the May summit between US President Donald Trump and Chinese President Xi Jinping in Beijing.reuters+1

Michael Hart, president of the American Chamber of Commerce in China, offered a similar assessment at the China International Fair for Investment and Trade in Xiamen this week, saying that two presidential meetings — in Busan in October 2025 and in Beijing in May 2026 — had contributed to greater stability.bastillepost

Chinese Competition Intensifies

The survey highlights a shifting set of challenges for American firms. Chinese companies are increasingly competing on speed to market, product development and quality, areas where foreign businesses once held clear advantages.english.dainikjagranmpcg+1

The report also showed some improvement in perceptions of China's regulatory environment, with 55 percent of respondents calling it transparent, up seven percentage points and above 50 percent for the first time since 2020. However, only 39 percent expected further regulatory opening.firstpost+1

Looking ahead, 31 percent of companies said they planned to increase investment in China in 2026, while 14 percent expected to reduce it. Half of companies with China-based research and development operations planned to increase spending this year, even as 46 percent said their headquarters had imposed restrictions on R&D activities in China. Xi Jinping is expected to visit Washington later this month, a trip businesses are watching for further signals on the trajectory of bilateral relations.businesstimes+2