Times sure have changed. Years ago, the American Chamber of Commerce here was focused squarely on barriers to inward investment, such as protection of IP, de jure and de facto protectionism, and tax treatment.

Now AmCham is getting into the outward investment game, calling upon the U.S. government to open up to China FDI:

“Chinese investors are increasingly concerned that investments may be hampered by US national security restrictions and may serve to drive much needed investment to Canada, Mexico and other countries,” said AmCham Shanghai’s report on Chinese FDI in the US.

Gee, I wonder why? It just might have something to do with deals like UNOCAL and 3COM, both of which were stopped for no apparent reason. Oh, wait, I forgot, folks in Washington were playing politics and used the CFIUS security review process as a lame excuse to stop the deals.

To invite, prepare for and capture a greater share of Chinese FDI, AmCham Shanghai said the US federal, state and local governments and their corporate constituents should make efforts to depoliticize the regulatory process.

I can certainly get on board with that recommendation, although I don’t think politics have changed in the past few years. The result in UNOCAL or 3COM could just as easily happen today.

Also, it recommended that US authorities support the US-China bilateral investment treaty (BIT) talks.

The BITs are regarded as crucial to boosting confidence in cross-border investments and have the potential to increase trade volume, especially during the signing and implementation stage, the report said.

I only know a little bit about BITs (heh heh), but if something is touted as a way to “boost confidence,” I have to wonder what is really going on. I attended a meeting a couple of years ago — local lawyers plus AmCham plus U.S. government BIT negotiators. I came away rather bored, since the entire meeting consisted of lawyers badmouthing CIETAC (China’s largest arbitration body) and talking up BIT provisions that could provide alternate dispute resolution options.

In many instances, those options are already available, or at least the foreign party can try during the negotiation process to move dispute resolution outside of the PRC (if that’s the goal). I disagree with that strategy anyway. I don’t think CIETAC is perfect, but it’s better than going to court here, and in most cases, offshore arbitration (maybe with the exception of Hong Kong, but only to a slight degree) remains a pain in the ass during the enforcement stage. I don’t see that basic framework changing all that much.

Another suggestion was to bridge the gap between different cultural business practices.

“Hire Chinese-proficient staff members at relevant governmental and quasi-governmental bodies to guide investments through the right channels,” the report said. “Understand who the investors are, the concerns of the community and how to narrow the business gap.”

I have no problem with the U.S. government becoming more “China friendly,” but the politics and legal framework together is 99% of the battle, with things like language lagging far behind at 1%. Chinese companies that make large investment have plenty of English speakers working for them and can hire service providers in the U.S. to facilitate their transactions. What matters is how difficult the approval process is and whether it’s worth the effort.