U.S. businesses operating in China are increasingly concerned about the country’s slowing economic growth, viewing it as a bigger challenge than bilateral trade frictions, according to a survey released on Friday by the American Chamber of Commerce in China.

Of the 368 companies that responded, 64% cited slowing growth in the world’s second-largest economy as their top concern, while 58% pointed to U.S.-China trade tensions as a key challenge, the survey found.

The results suggest that for many U.S. companies, domestic economic conditions in China now outweigh the impact of geopolitical and trade disputes. A significant number of respondents operate businesses geared primarily toward China’s vast domestic market of around 1.4 billion people, rather than relying heavily on exports to the United States.

China’s economy is widely expected to lose further momentum this year after expanding at about a 5% annual pace in 2025, according to economists. While external demand remained resilient last year, with export growth outpacing imports, this contributed to a record trade surplus of nearly $1.2 trillion, raising concerns among trading partners but offering limited relief to domestically focused firms.

Despite the growth headwinds, the survey indicated an improvement in overall business sentiment compared with the previous year. More than half of respondents said they were profitable in 2025, up from less than half a year earlier, suggesting that some companies have adapted to the challenging operating environment.

The findings underscore the shifting priorities of foreign firms in China, where long-term economic prospects and consumer demand are increasingly seen as more critical to business performance than trade policy uncertainty alone.