The exodus hasn’t materialized. Although some companies—notably those in labor-intensive industries—left China before the pandemic, the decision to leave involves multiple considerations.
Many enterprises have good reasons to stay. For example, why leave behind one of the world’s richest markets? China has the second-largest economy in the world and consumes about 20% of the world’s output. Companies in industries such as the technology and automotive sectors are unlikely to abandon their investments in sophisticated and highly integrated supply based in China any time soon.
An American Chamber of Commerce survey in March 2020 found that more than 70% of the companies in China had no plans to relocate manufacturing, their supply chains or sourcing out of China because of the pandemic.
It is tempting to assume President Trump in a second term would double down on his trade war with China, leading more companies to reconsider their Chinese operations in the face of even greater volatility.
In contrast, it is easy to expect a Joe Biden victory to pave the way for more stability and perhaps even normalized relations between the two trade giants.
However, anti-China sentiment might be the only thing Democrats and Republicans have in common. China may have reason to fear a Biden administration more than the return of their Republican antagonist.