Kyle Freeman Speaks at the Wall Street Journal’s Risk and Compliance Forum
On May 9, 2023, Kyle Freeman, Partner at Dezan Shira & Associates and Head of the North American desk joined the Wall Street Journal’s Risk and Compliance Forum’s session titled: Working in China.
During the session, Kyle and co-panelist Keith Williamson of Alvarez & Marshal discussed how US businesses are navigating legal and compliance complexities amid escalating US-China tensions.
Richard Vanderford of the Wall Street Journal asked Keith questions on how trade tensions have spilled into their day-to-day business and whether it has made it more challenging to help companies manage market risks.
On the topic of some of China’s new laws, such as the anti-sanctions law, the panelists agreed that many companies are in a wait-and-see mode. China has not yet applied that tool against a foreign company.
To Kyle, Richard raised the issue of China’s zero-Covid policy, which ended earlier this year, and its impact on doing business in China. Kyle discussed the reality of doing business on the ground amid the prevention policies and how, while an impediment to growth and a significant concern of multinationals, the policy is now dismantled, and business-as-usual is slowly returning.
However, Kyle also brought up the perspective of multinationals who are hedging against future risk and diversifying their supply chains. He noted that while initially the relocation was related primarily to cost, companies are now relocating to countries like Mexico, Vietnam, and India to reduce the vulnerability of their supply chains and dependency on China.
During the Q&A section run by Nick Elliott, the panel discussed strategies for staying updated on regulatory matters in China. These include seeking advice from local advisors, looking at literature published by international firms in English and in general, conducting due diligence whenever possible, and prioritizing a robust compliance package when entering China.
Demand for China is Still Up
Despite US-China tensions, China is still an important market for US companies. On a recent trip to the US, Kyle had the opportunity to speak with clients and partner firms on their perspective on China. The conversations highlighted how intertwined the two economies still are and likely will continue to be.
If you are interested in entering the Chinese market, download a copy of our Doing Business in China 2023 Guide for US Businesses.