But tastes in China are also changing - to the detriment of US companies. As China becomes increasingly cosmopolitan, the early admiration for all things American is fading.

Every company wants a piece of China and American companies certainly have trouble measuring up to European, and even some Chinese, brands, says Hartmann.

"But US companies are aware of it and trying to build a positive image in China," he says.

"They understand they have to provide something besides the goods."

One way is to give to charity. For example, Starbucks donated 40 million yuan (US$5 million) during 2003-2005, Motorola gave 25 million yuan (US$3.1 million) and Pfizer 18.5 million yuan (US$2.3 million).

Anti-China rhetoric

While US businesses prosper in China and integration between the two countries grows, the rhetoric in the United States, where some hold China responsible for its weak manufacturing base, is dangerous, says Mei, the researcher.

It is meaningless to focus on the bilateral trade deficit - even a deficit that Rob Portman, the US trade representative, decried as 'the largest trade deficit in the history of the world' - as globalization takes many shapes and forms, he says.

Caterpillar CEO Jim Owens - who speaks strongly against the anti-China sentiment and, in particular, a proposal to impose a 27.5 per cent tariff on Chinese imports if Beijing does not revalue its currency - says it is time to curb the rhetoric and focus more on engagement.

"Caterpillar is thriving today not because we survived globalization, but because we embraced it," he says.

They want to isolate the United States by erecting trade and investment barriers as they believe US companies can no longer compete on their own, he says.

"However, over the last few years, we have more than doubled our Chinese workforce and significantly expanded our sales there. At the same time, we have increased our exports to China by 40 per cent - helping to create some 5,000 new production jobs in the United States.

"The United States can no longer go it alone in an increasingly global economy. We can't operate as a single-engine plane trying to pull the rest of the world along with us. We need a second engine for growth - and China, along with its Asian neighbours, is providing it."

Emory Williams from the American chamber says that a good trend is that more US lawmakers are coming to China on visits to discuss problems - such as with intellectual property rights - with Chinese legislators, to find out what the issues are, and what the opportunities and challenges are, adding that more Chinese lawmakers are going to the United States, too.

"The thing that matters most is how you develop a system under which both parties can co-operate to solve bilateral issues. The more often they go to see the other, the better the understanding is."  

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