THE American Chamber of Commerce in Shanghai, founded in 1915, is known as the "Voice of American Business" in China. Today, it is the largest and fastest growing American Chamber in the Asia Pacific region.

AmCham Shanghai helps United States firms tap into the vast and complicated Chinese market and provides various services enabling them to better adapt to the changing Chinese business climate.

It also offers constructive advice to the Chinese government to create a healthier and more modern administrative environment to support China's growth.

The business association frequently publishes in-depth reports and organizes multi-faceted events for members. One of the upcoming events is the AmCham Shanghai 2011 Human Resources Fair and Workshop on August 26 at the Shanghai World Financial Center.

As the US celebrates Independence Day today, Shanghai Daily interviews Brenda Lei Foster, president of AmCham Shanghai, about the past, present and future of this strategically important association.

Shanghai Daily: Please describe AmCham Shanghai's role in the US-China businesses? How is it changing and dealing with changes?

Foster: AmCham Shanghai was founded in 1915 and was the third American Chamber established abroad. Relaunched in 1987, today we are the largest and fastest growing American Chamber in the Asia Pacific region with more than 3,500 members. The chamber's diverse membership ranges from Fortune 500 corporations to small- and medium-sized enterprises, entrepreneurs and individuals.

Our primary mission is to support the success of our members and we do that by promoting a healthy business environment in China, working to strengthen US-China commercial ties and providing high-quality business information and resources in the form of reports and publications and through events.

Corporate responsibility is an important and growing trend in China which AmCham Shanghai recognized more than six years ago when we started the chamber's Corporate Social Responsibility program, now a leading platform for advancing corporate social responsibility in China.

CSR is critical to US companies in China in several key ways. First, CSR is a very visible way to show that you are giving back to the community in which you live. Second, given the challenges facing companies in China's competitive job market, CSR is great way to recruit and retain talented staff. Finally, CSR builds bridges with the leaders of the communities in which our member companies work and allows them to build relations with the government at all levels.

AmCham Shanghai focuses on five key areas of CSR: community outreach, philanthropy, environmental stewardship, corporate governance and employee health and safety. Since 2000, together with AmCham Shanghai member companies, AmCham Shanghai has raised more than 7 million yuan (US$1.1 million) to support the Special Olympics, the Shanghai Soong Ching Ling Foundation's Mother and Infant Care Project and disaster relief efforts in the earthquake-struck regions of Sichuan Province. We will continue to work together with our members to promote and share best CSR practices and to support the development of CSR programs.



Shanghai Daily: China has always been trying to improve the business environment for foreign investors. How would you describe China's efforts and the current climate for foreign investment? What's the biggest achievement and what else needs to be done to make the environment more congenial.

Foster: Generally speaking, US companies continue to show impressive financial results in an increasingly competitive domestic market in China and are confident about their business prospects moving forward.

Very important to foreign investment in China has been the development of China's domestic market and we support China's efforts in this area. While we are still in the early stages, it is important to note that a strong majority of US companies here are "in China for China" - in other words, they are here to serve the China market. A big reason for this is the burgeoning consumer market.

US companies understand that China has a challenging business environment. Intense competition and the complexity of China's many regional markets contribute to daunting business obstacles. The market is complicated further by a business environment that can be bureaucratic and lacking in transparency. A more clear, consistent and transparent regulatory framework for companies operating in China would support a more vibrant business climate.

Another challenge is finding qualified staff. The China market is growing so this is not necessarily a surprising problem but we hope to continue to work with government officials to find ways to address human resource constraints facing US companies in China.



Shanghai Daily: What are the findings of AmCham's latest survey of the health and vitality of US businesses in China?

Foster: AmCham Shanghai first launched its annual business climate survey in 1999 so we've been able to track results for the past 12 years. Results from our most recent annual survey (contained in the 2010-2011 AmCham-Shanghai China Business Report) show that the financial performance of American companies in China improved in 2010 following what had been an uneven period of growth between 2008 and 2009. Not only have US companies in China recovered from the economic downturn, they are reporting strong financial performance and remain optimistic about their business prospects moving forward.

However, just as there is no one "China market," there is no single description that accurately depicts a US company with operations in China. This year's survey results illustrate that, as the China market matures, the challenges and opportunities for US companies vary by market sector and by industry.

One of the key findings of this year's report is that while some US companies do not necessarily consider China as welcoming a business environment as they would prefer, they are nonetheless quite confident in their future business in the country. The results indicate that US companies, by and large, base their confidence in the China market much more heavily on fundamentals of market growth potential than they do on China's shifting regulatory environment. While we continue to work with government officials in China at all levels to improve the business climate here, I think it is fair to say that US companies in China have come to expect challenges, have weighed them against the opportunities and have found a way to succeed in China despite them.



Shanghai Daily: What's your advice to investors who want to ride the tide of China's economic development? Is this a good time to enter the market and are there preparations that can guarantee success? What sectors are most promising for foreign investors?

Foster: The China market offers tremendous opportunity, but it also offers many challenges. There is no guarantee of success! The operating environment is only getting tougher. Domestic competitors are stronger than ever before and the regulatory environment can be quite unclear and difficult to predict.

Critical to any foreign company contemplating investment or expansion in China is to conduct a thorough due diligence process and have a clear understanding of what you want to accomplish. What is also clear is that experience in the China market pays off. In our 2010-2011 China Business Report, we found that companies with more than five years of experience were generally doing quite well. In other words, those that have invested time and resources in the China market were seeing returns. It is also clear that there is no one "China market" - generally speaking, US companies in retail and manufacturing are doing better than those in the services industry. I think it is also fair to say companies operating in regulated industries will have more obstacles than those working in sectors that are more open.



Shanghai Daily: The US and China have developed an intricate economic relationship. Both want to grab opportunities offered by globalization, but at the same time they must confront the accompanying challenges. What do you see as the direction of the Sino-US economic relationship? Will we see more cooperation or more disputes?

Foster: When we ask AmCham Shanghai member companies about their five-year business outlook in China, more than 90 percent respond that they are optimistic. I would have to agree.

While the US and China won't always agree, our two countries have never been more interconnected economically than they are today. China is America's third largest export market and climbing. The US is one of China's top investment destinations, and trade between our two countries is at historic highs. The economies of China and the US are largely complementary and as long as we continue to engage each other to find solutions to the challenges we face, I believe the relationship will only get stronger.