News / Economy

US Business Survey: China's Smog Driving Top Foreign Talent Away

Heavy haze on a severely polluted day obscures a man and a car traveling on a road in Pingshan county of Shijiazhuang in northern China's Hebei province, Feb. 26, 2014.
Heavy haze on a severely polluted day obscures a man and a car traveling on a road in Pingshan county of Shijiazhuang in northern China's Hebei province, Feb. 26, 2014.
Reuters
— China's smog is making it harder for foreign firms to convince top executives to work in the country, the American Chamber of Commerce in Beijing said on
Wednesday, offering some of the strongest evidence yet on how pollution is hurting recruitment.
 
Some 48 percent of the 365 foreign companies that replied to the chamber's annual survey, which covers businesses in China's northern cities, said concerns over air quality were turning senior executives away.
 
Pollution is "a difficulty in recruiting and retaining senior executive talent," said the report. The 2014 figure is a jump from the 19 percent of foreign firms that said smog was a problem for recruitment in 2010.
 
China's slowing economy, however, remained the top risk for companies, the report added.
 
Foreign executives increasingly complain about pollution in China and the perceived impact it is having on the health of themselves and their families. Several high-profile executives have left China in recent years, citing pollution as the main reason for their decision to go.
 
Almost all Chinese cities monitored for pollution last year failed to meet state standards, but northern China suffers the most. It is home to much of China's coal, steel and cement production. It is also much colder, relying on industrial coal boilers to provide heating during the long winter.
 
The capital Beijing, for example, is surrounded by the big and heavily polluted industrial province of Hebei. It is also choked by traffic.
 
By contrast, China's commercial capital Shanghai, in the south, suffers less air pollution. Indeed, a similar survey conducted by the American Chamber of Commerce's Shanghai branch did not ask if pollution was affecting recruitment.
 
Premier Li Keqiang "declared war" on pollution at the opening of the annual session of parliament this month, part of a push to wean the world's second biggest economy from credit-fuelled growth to more sustainable development.
 
China also pledged on Sunday to make 60 percent of its cities meet national pollution standards by 2020.
 
Lulu Zhou, associate director of the Beijing Office of international recruitment agency Robert Walters China, said some foreign executives were using pollution to negotiate higher salary packages.
 
"We have seen some senior level professionals ... who are concerned about relocating to Beijing because of the pollution," she said.
 
In a sign of the growing corporate concern over pollution, Japanese electronics firm Panasonic Corp. has told its unions it will review the hardship allowance paid to expatriates in China because of the air quality, a spokeswoman said on Wednesday.
 
And a state-owned Chinese insurer said this week it would offer Beijing residents insurance cover against health risks caused by air pollution, promising to pay out 1,500 yuan ($240) to policy holders hospitalised by smog.
 
The policy, available for people aged 10 to 50, will also pay out 300 yuan when the city's official smog index exceeds 300 for five consecutive days, a level considered "hazardous", according to a notice posted on the People's Insurance Company of China (PICC) website (www.epicc.com.cn.)
 
Beijing's official air quality index (AQI), which measures airborne pollutants including particulate matter and sulphur dioxide, routinely exceeds 300, and sometimes hits levels higher than 500.
 
Slowing economy the big concern
 
Despite the concerns over pollution, China's cooling economy, which government leaders project to grow this year at about 7.5 percent, posed the greatest risk to companies, according to those polled in the Beijing survey.
 
Firms increasingly reported a stagnation or contraction in operating margins compared with previous years, it said. As a result, more foreign firms saw China "as just one of many investment possibilities", the report said.
 
Nevertheless, a majority of companies surveyed remained optimistic about the business outlook for the next two years.

"This optimism is driven by our membership's confidence in their own ability to adjust and deal with the challenges," said Mark Duval, China president of the American Chamber of Commerce.

Many members had high expectations that recently announced economic reforms might deliver, Duval added.
 
But two in five respondents to the Beijing survey said the business climate had become less welcoming for multinationals, with a similar number saying foreign firms were being singled out in a series of pricing and corruption investigations.
 
Those investigations have targeted various sectors, including pharmaceutical and milk powder multinationals, as well as American technology companies.
 
Most recently, China's anti-monopoly regulator said Qualcomm Inc. was suspected of overcharging and abusing its market position. The U.S. chip giant has said it was cooperating with the investigation by the National Development and Reform Commission.
 
Respondents also chafed at perceived state enterprise favoritism, with 77 percent believing policies benefiting state-owned firms had negatively impacted their business.

"My judgement is that the biggest area that drives [this response] would be market access," said Duval.
 
Protection of trade secrets and company name theft were among other issues worrying businesses. Half of all respondents said that protecting confidential company data was a concern. Other difficulties were a lack of clarity and inconsistency in the application of laws and regulations, the survey said.

You May Like

Uganda Court Annuls Anti-Gay Law

Court says law was passed in parliament without enough members present for a full quorum More

Multimedia Thailand Makes Efforts to Improve Conditions for Migrant Laborers

In Thailand, its not uncommon for parents to bring their children to work; one company, in-collaboration with other organizations, address safety concerns More

In Indonesia, Jihad Video Raises Concern

Video calls on Indonesians to join Islamic State of Iraq and the Levant, ISIL More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
In Thailand, Some Efforts to Improve Conditions For Migrant Laborersi
X
Steve Herman
August 01, 2014 6:22 PM
Thailand has been facing increasing international scrutiny as a hub of human trafficking and slave labor. Some of the kingdom’s companies are striving to improve working conditions, especially for the millions of migrant laborers from surrounding countries. VOA Correspondent Steve Herman in Bangkok takes a look at one initiative for children at construction sites
Video

Video In Thailand, Some Efforts to Improve Conditions For Migrant Laborers

Thailand has been facing increasing international scrutiny as a hub of human trafficking and slave labor. Some of the kingdom’s companies are striving to improve working conditions, especially for the millions of migrant laborers from surrounding countries. VOA Correspondent Steve Herman in Bangkok takes a look at one initiative for children at construction sites
Video

Video Public Raises its Voice on Power Plant Pollution

In the United States, proposed rules to cut pollution from the nation’s 600 coal-fired power plants are generating a heated debate. The U.S. Environmental Protection Agency, charged with writing and implementing the plan, has already received 300,000 written comments. As VOA’s Rosanne Skirble reports, another 1,600 people are lining up this week at EPA headquarters and at satellite offices around the country to give their testimony in person.
Video

Video Information War Rages Alongside Real One in Ukraine

The downing of the Malaysian airliner two weeks ago, and allegations that Russians are shelling Ukrainian troops across the border, have moved the information war swirling around the Ukrainian conflict to a new level. VOA's Al Pessin reports from Kyiv.
Video

Video When Fighting Eases, Gazans Line Up at Bakeries

When there is a lull in the conflict in Gaza, residents who have been hunkered down in their apartments rush out to stock up on food and other necessities. Probably the most important destination is the local bakery. VOA’s Scott Bobb reports from Gaza City.
Video

Video China Investigates Powerful Former Security Chief

The public in China is welcoming the Communist Party's decision to investigate one of the country's once most powerful politicians, former domestic security chief Zhou Yongkang. Analysts say the move by President Xi Jinping is not only an effort to win more support for the party, but an essential step to furthering much needed economic reforms and removing those who would stand in the way of change. VOA's Bill Ide has more from Beijing.
Video

Video US-Funded Program Offers Honduran Children Alternative to Illegal Immigration

President Obama and Central American leaders recently agreed to come up with a plan to address poverty and crime in the region that is fueling the surge of young migrants trying to illegally enter the United States. VOA’s Brian Padden looks at one such program in Honduras - funded in part by the United States - which gives street kids not only food and safety but a chance for a better life without, crossing the border.
Video

Video 'Fab Lab' Igniting Revolution in Kenya

The University of Nairobi’s Science and Technology Park is banking on 3-D prototyping to spark a manufacturing revolution in the country. Lenny Ruvaga has more for from Nairobi's so-called “FabLab” for VOA.
Video

Video Immigrant Influx on Texas Border Heats Up Political Debate

Immigrants from Central America continue to cross the U.S.-Mexico border in south Texas, seeking asylum in the United States, as officials grapple with ways to deal with the problem and provide shelter for thousands of minors among the illegal border crossers. As VOA's Greg Flakus reports from Houston, the issue is complicated by internal U.S. politics and U.S. relations with the troubled nations that immigrants are fleeing.

AppleAndroid

World Currencies

EUR
USD
0.7305
JPY
USD
101.53
GBP
USD
0.5830
CAD
USD
1.0656
INR
USD
60.075

Rates may not be current.