Confidence among American companies surveyed in China has risen, and Washington should welcome the improvement. But commercial success under existing rules does not establish that those rules work well. Firms can become better at operating across divided markets without resolving the costs of division. Nor does stronger confidence necessarily make business a stronger advocate for opening markets.
The American Chamber of Commerce in Shanghai’s 2026 business report supplies encouraging evidence. Among 262 responding members, 58 percent were optimistic about the next five years, up 17 percentage points. Seventy-eight percent reported that they were profitable in 2025. Twenty-eight percent increased investment that year. These findings describe different dimensions of business performance. They cannot be combined into a single verdict on American policy toward China.
Profitability is a threshold, not a measure of how much a firm earned or what it could have earned under different conditions. A profitable operation may still bear expensive restrictions. Equally, disappointing results may reflect stronger competitors or weak demand rather than government obstruction. Evaluating policy requires identifying the constraint and the difference its removal would make.
Consider a company that maintains access to customers by establishing separate production arrangements for different markets. That decision may be commercially sensible. It may also require duplicated capacity, additional compliance work or capital that could have financed another project. This is one possible mechanism, not a finding about every company in the survey. Successful adjustment does not reveal whether its costs were small, or whether a less restrictive arrangement could have delivered the same security benefit.
The survey’s timing and scope also matter. Its profit and investment figures concern 2025; its confidence measure looks forward five years. The headline percentages do not establish that the same firms were profitable, optimistic and expanding. Responding members cannot represent every company that left China or never entered. Washington needs to examine the opportunities existing arrangements may discourage alongside the firms that can make them work.
General Motors’ decision in August to extend its joint venture with SAIC for twenty years is a concrete expression of commitment. It signals that the partners see continuing commercial value in cooperation. It does not establish the terms on which Chinese automakers will be allowed to compete in the United States.
A September 21 letter from House lawmakers urged the president to maintain protections against Chinese automobiles, including restrictions on access through imports and local production. These are decisions by different actors. Together, they illustrate how investment in China and demands for restrictions at home can advance simultaneously.
That coexistence complicates the familiar idea that business will automatically restrain rivalry. An exporter seeking customers abroad and a manufacturer facing import competition may want different policies. A firm can have both interests. Overseas earnings can sustain research and employment at home, yet those benefits need not reach the same communities that bear adjustment costs. Aggregate corporate confidence cannot tell elected officials how these interests will align.
Adaptation may change that alignment over time. Separate regional operations could make a company less dependent on common rules, weakening its incentive to seek broader market opening. Alternatively, the expense of maintaining those operations could intensify its demand for predictable access. Which effect dominates is an empirical question about investment and advocacy. Optimism alone cannot answer it.
A useful assessment would follow investment commitments and market access alongside profitability. Are firms financing additional capacity, replacing existing assets or maintaining operations? Can new entrants obtain the permissions available to established companies? Have approval times become more predictable? Officials should also examine what firms actually ask governments to change. Requests for access to customers or protection from competitors reveal interests that an earnings report cannot.
The distinction matters in both countries. A stronger Chinese competitor presents American firms with a commercial challenge; discriminatory treatment or an unpredictable license presents a different problem. American restrictions adopted for national security should be assessed against the risks they address and the economic costs they impose. A company’s profit statement cannot perform either assessment on its own.
There is a practical opportunity here for Washington and Beijing. Clearer permitted activities and dependable review procedures can make legitimate commerce easier to plan, even where major disagreements persist. Progress should be judged by whether those changes improve access and reduce avoidable costs, including for firms without the resources to reorganize around every obstacle.
Better business sentiment deserves attention. The policy question is what produced it and who shares the gains. Companies’ success in navigating a divided system shows that some firms can prosper under existing arrangements. It leaves governments responsible for showing whether the division itself is necessary, proportionate and worth its cost.
