SINGAPORE—During Donald Trump’s first term, U.S. companies argued that a trade war with China was bad for Americans.
Businesses including Apple, Nike and small retailers said raising tariffs on imports from China would raise prices for consumers. Farmers and other businesses that exported to China warned about retaliatory tariffs from Beijing.
Now, as Trump prepares for his second administration, American companies have largely gone silent about the importance of the U.S.-China relationship. That is because American businesses no longer see China as the land of opportunity.
The promise of China’s market has faded as its once-booming economy hits trouble. And Beijing and Washington have implemented policies that make it harder for American businesses to succeed in the land of 1.4 billion people.
“U.S. companies are more wary about doing business in China,” said Anja Manuel, the executive director of the Aspen Security Forum and a consultant for American companies doing business abroad. “You see that across all industries.”
In 2023, China trailed only Mexico and Canada as a buyer of U.S. products. American exports to China totaled $147.8 billion that year, according to the U.S. Census Bureau.
Still, that was down about 4% from the previous year. The U.S. trade deficit in goods with China—the figure that looms large in Trump’s mind—was $245 billion in the first 10 months of 2024, according to the Census Bureau.
While many U.S. companies still have big stakes in China, others have scaled back. The American Chamber of Commerce in China, which represents more than 800 mainly U.S. companies in the country, said its members have gone to other countries for new investments.
The big problem is China’s economy, the world’s second-biggest after the U.S. For decades, it grew at nearly 10% annually. It was on track to gain 5% in 2024, but economists say that target will be tougher to hit in 2025.
U.S. companies used to put up with the difficulties of doing business in China, including potential loss of intellectual property and pressure from state-owned companies, because of the growth potential.
Starbucks shows how that has changed. In 2016, then-chief executive Howard Schultz said China could become the coffee company’s biggest market. Since then, Starbucks has been undercut by local chains selling cups of joe for $2 or less, and has fallen behind domestic leader Luckin Coffee.