New York: The heightened tensions between China and the United States after US House Speaker Nancy Pelosi's visit to Taiwan have swiftly turned down the burgeoning Chinese companies operating in the US, making it harder for them to strengthen their brand presence in the world's largest economy.

The China General Chamber of Commerce-USA's annual business survey of Chinese enterprises in the US, published this summer, showed that only 10 per cent of respondents see bilateral relations improving in the upcoming year, the lowest since 2018, Asia Nikkei reported.

As per the report, among the 111 companies that responded to the survey, 39 per cent of respondents were against the view that US-China economic and trade relations will improve this year, while, the report said that only 19 per cent foresee that trade relations between the two countries will moderately or substantially improve this year.

Director of corporate communication and research at China General Chamber of Commerce (CGCC), Abby Li, said, "Companies' Chinese headquarters, their parent companies, their commitment to the US market seem to be shaking a bit."

"Only 74 per cent of our responding companies are reinvesting their U.S. revenues back to their U.S. business again; that number was 90 per cent last year and 80 per cent in our 2020 survey," he added.

Li said one of the major challenges Chinese companies face in the US is to build their own brand and trust with American consumers.

According to the CGCC survey, about 60 per cent of the respondents feel they have a neutral or weak brand presence in the US., Asia Nikkei reported.

Some of the challenges faced by the Chinese companies include the lack of trust in Chinese brands by customers, anti-China sentiments, lack of understanding of marketing in the US, and conflicts of branding strategies between the local team and headquarters, Li said.

"Companies sometimes will choose to hide their Chinese background and try to present [themselves] as a US brand or global brand," said Li. "It will be better accepted, especially when it comes to consumer-facing products and services."

Chinese companies also have a difficult time digesting US laws, according to the CGCC survey.

Of all respondents, 50 per cent listed complex and ambiguous US laws and regulations as their top challenge, followed by 49 per cent concerned by potential conflicts between the US and China laws.

Wally Hsueh, Vice President of International Affairs at FedEx, said that the US has always spent time on government relations, getting to know people, and building their brand of who they are, which China lacks, and "Taiwan is a very relevant example of it, he added.

Peter Reisman, Managing Director and Chief Communication Officer at Bank of China USA and co-chair of the CGCC government and public relations committee, said that amid the geopolitical tensions rising between the two countries, making friends in the US is vital for Chinese companies.

"I've seen American companies really embed themselves in Chinese culture and hire local staff. The Chinese companies that come here, in my opinion, have to do the same."

He highlighted the need to localize the staff which he said, "will helps in many ways."

Chris Pereira, founder, and president of public relations firm North American Ecosystem Institute said inquiries from Chinese businesses to set up shop in the US have increased five times this year compared to last year at his company.

He said his firm has about 40 companies in the pipeline preparing to launch in the US, with half from China and half founded by Chinese in the US.

"Because of COVID and all the economic reasons, any company around the world is looking to add in extra revenue streams, it makes sense to either go to the US or other regions to sell your products, too," Pereira told Nikkei Asia. "I think there's also policy uncertainty in China, whether China is going to continue to remain open."

"I think in the past 10 years, a lot of Chinese companies failed because they didn't localize," said Pereira. "It's very easy to hire a local team, it's very hard to trust a local team. ... It results in a lot of internal friction between the Chinese team and the local team. Because the local team doesn't speak Chinese, doesn't understand the headquarters, they leave, you lose your talent."

"Now there's a longer-term mindset and willingness to invest in relationships," he added.

Both Reisman and Hsueh emphasized that investing in relationships in the US, especially with the government, is a long-term process and a very worthwhile one, Asia Nikkei reported.

With the above findings, one thing is clear, although operating in the US market poses many challenges for Chinese companies, the interest in entering the US market remains strong, but coming to the US is not too difficult, but surviving in the American market is no walk in the park, as Chinese companies have learned over the years.