Faced with the worst US-China rift in 50 years and the COVID-19 pandemic that forced tens — if not hundreds — of millions of Chinese into lockdown, China experts predicted dire consequences for the Middle Kingdom, claiming foreign companies would leave China in droves, and that the world’s decoupling with China was already a fait accompli.To get more China business news, you can visit shine news official website.

China has not witnessed a mass exodus. Indeed, some companies de-risked their China exposure and found secondary and tertiary supply chains in Southeast Asia, while others set up smaller, "safety” factories closer to home. But these are, by far, the exceptions rather than the rule.

Japanese companies, for example, continue to be bullish on China. In a recent survey conducted by the Japan External Trade Organization (JETRO), only 7.2% of Japanese companies reported they were contemplating moving production out of China, down from 9.2% in 2019.Similarly, in a February survey, the German Chamber of Commerce in China reported 96% of German companies in China plan to stay, and 72% intend to invest more in China.

China possesses an advanced infrastructure, business-friendly regulations, highly skilled labor force, and a "can do” attitude. And the World Bank has projected a 7.9% growth rate for China this year, taking the country back to a pre-pandemic growth scenario. For these reasons, China is — and will remain — the world’s factory.

UBCO Ltd., a New Zealand company that exports electric motorcycles from its manufacturing partners in Yantai and Shanghai, faced many China hurdles — EU anti-dumping duties, US tariffs, COVID factory closures — but still insists on maintaining a China presence.

"Chinese factories are extremely adaptable, and lightning quick at it,” explained Vanessa Ho, former executive vice president at UBCO. "Our partners can go from assembling a pedal bike to an electric bike overnight.”

UBCO realized it would be impossible find a substitute factory as skilled and flexible at making bicycles, so it looked for ways to legally offset US tariffs. "We went from shipping fully assembled bikes to fully assembled parts, and reassembled them in the United States. We now only pay 7% [instead of 25%] tariffs,” said Ho.

Kingston Technology, the world’s largest producer of computer memory with revenues of over $13 billion and production facilities in Shanghai, went through some difficult times during the pandemic, but has no plans to relocate.

"Lockdown was awful. We were literally in the dark. Many employees went home for the Lunar New Year, so we couldn’t find them, didn’t know where they were. We didn’t know when we could reopen,” lamented Kingston CEO John Tu.

After four long, excruciating months, Kingston was given the green light to reopen. "We had so many COVID protocols to follow — temperature testing, social distancing, and limited work hours — but, except for my children’s birth, it was still the best day of my life. We’re back and here to stay!” exclaimed Tu.Today, Kingston Shanghai can’t produce enough to keep up with demand. "We went from zero to 100% capacity in a matter of weeks, mostly due to pent-up domestic demand. Now, we’re producing 24/7, again.”

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