United States' companies that are less competitive in global trade may need to make adjustments to cope with "structural changes of the world economy that follow China's development," said Robert Kapp, president of the US-China Business Council, the principal organization for US companies engaged in business with China.

Kapp said he believed it would be inevitable that there would be job losses in the US because of exports of inexpensive Chinese products, China Daily reported Monday.

Sometimes when he heard accusations that Chinese products were making Americans unemployed, he would remind them that Chinese workers had been laid off in the process of the country's reform and opening up to the world.

"It is all about modernization," said Kapp, a former Yale professor on Chinese history, in an interview with China Daily at the World Economic Forum's Beijing meeting earlier this month.

Still, Kapp said the United States is now delicately balanced between supporting free trade and supporting protectionism and that was a reality that people doing business in China-US trade have to face.

But by and large, China-US trade is on a more predictable course than it used to be, he said.

Kapp, who took up his present position in 1994, said the most stressful years for US' companies doing business in China were 1994 to 2000, when they had to lobby hard for Normal Trade Relations (NTR) with China.

During those six years, the US Congress would engage in with politically-charged debate on NTR with China every year. Without NTR, the China-US trade would have been subject to high trade barriers that would have hurt the commercial interests of both sides.

In 2000, the US decided to have Permanent Normal Trade Relations (PNTR) with China, which paved the way for the endorsement of bilateral negotiations for China's joining of the World Trade Organization.

Kapp declined to tell in detail how US' business circles lobbied for the NTR and PNTR with China, but he said they did put considerable efforts into mobilizing forces in their favour.

"Our efforts are quietly effective," he said.

Now life seems more easy than those days.

There is no coalition in the US that fights for strong US-China trade relations despite expanding business ties between the two.

According to statistics compiled by China's Ministry of Commerce, bilateral trade volume reached US$126 billion last year. So far, US companies have invested more than US$45 billion in China.

But Kapp said US' businesses in China trade did not have to worry about an immediate crisis such as the NTR debate.

He said that in some US' businesspeople's minds, China was still stereotyped as a mysterious oriental country.

But as China's market economy develops and US' companies' experiences grow, they are seeing more familiar phenomena in the market and it is more "comprehensible," Kapp said.

He said romantic imaginings about the enormous Chinese market were already over. "Nobody is talking about selling to everyone of 1 billion people. They are now more sophisticated in spotting which part of the Chinese population they should target.

"However, as ever, new challenges keep emerging."

As China integrates into the global economy, the challenge now is that "every company has to decide how China fits into its overall operations," he said.

Lots of US' companies have been in the Chinese market for years, but today they still have to work out a new answer to the question about what they should do to be able to succeed in China.

But they might need to do it again tomorrow because "China is not static... it is moving."

Source: China Daily