Matthew Margulies, a vice president of China operations for the U.S.-China Business Council, is currently facing the same quandary as many of the Americans that his organization is supposed to represent. He is stuck in the U.S., after waiting for months to board a flight back to Beijing, where his job is based. 

This month, after successfully securing a visa, Margulies was finally able to book a flight to China that departs in early July. But his itinerary is far from direct — he will connect through Washington, Frankfort, Helsinki, and Shanghai, before reaching Beijing. Though he is relieved, he doesn’t want to get his hopes up because the travel restrictions are constantly evolving. “My fingers are crossed,” Margulies said, “but I don’t want to jinx anything.”

Margulies is not alone. Most American businesses with operations in China are grappling with the challenge of how to get employees who left China at the height of the Covid-19 epidemic earlier this year, back into the country. According to a survey conducted by the American Chamber of Commerce in China, an organization with members from over 900 American companies operating in China, 90 percent of the respondents indicated that global travel disruptions represented the most important business challenge in May.

“We have senior executives from our member companies stranded all over the world,” said Alan Beebe, president of the American Chamber of Commerce in China. “Getting our members back into China is a much-needed step, and one that will build and restore confidence among the foreign business community.” 

The impact of travel restrictions on U.S. companies is wide-ranging. Some companies with senior executives stuck outside of China cannot conduct high-level meetings or maintain important relationships with Chinese government officials. Other companies have complained that their inability to get American engineers back into the country has hampered their manufacturing operations. And on a more personal level, some companies are dealing with the puzzle of reuniting American employees with family members who had remained in China after the pandemic first emerged early this year.

Boeing, the American aerospace giant, is one of many businesses caught in the troubles that grew out of the global pandemic. The company, which has three subsidiaries and four joint ventures in China that have been operating even during the pandemic, gave American employees the option to leave China after the pandemic hit. But “since then, the number of Boeing employees traveling to China, in line with global travel in general, has been relatively constrained,” a company spokesperson said.

There are two crucial challenges in relocating Americans back into China: securing a visa through a new, highly restrictive approval process operated by the Chinese government, and booking a seat on the limited number of flights that now operate between the two countries. “It is extremely difficult as a foreign national, from the U.S. or another country, to receive visa approval to enter China,” said Kyle Freeman, a partner at Dezan Shira & Associates in Beijing, an Asia-focused professional services advisory firm. 

There are two crucial challenges in relocating Americans back into China: securing a visa through a new, highly restrictive approval process and booking a seat on the limited number of flights between the countries.

On March 28, in an attempt to reduce the risk of a second Covid-19 outbreak, the Chinese government announced that it would not allow any foreigners into China, even those with valid visas or residence permits. Foreigners already residing in China were allowed to stay, but any foreign citizen looking to enter now is required to reapply for a visa, and prove that they have an urgent reason for their visit. 

Analysts say the visa application requirements vary by Chinese locality, and the process is not transparent. In most cases, according to Freeman, at Dezan Shira, foreigner business workers seeking to re-enter the country must first secure a letter from China’s foreign ministry, in the district they are planning to visit. In order to secure that letter, they must provide some proof about their company’s economic contribution to China, a valid reason they must urgently return and some type of guarantee regarding their health status. Following that process, Americans must present the letter to their local Chinese embassy or consulate, which are operating with limited hours due to the Covid-19 pandemic.

But securing a visa isn’t enough. The flight capacity between the U.S. and China has been limited, due to an ongoing aviation dispute between the two countries, complicating travel arrangements.

The aviation stand-off started in May, when Chinese regulators blocked two American carriers, Delta and United Airlines, from resuming their China service, which the companies had temporarily halted in February due to the pandemic. In response, the U.S. Department of Transportation, or D.O.T., threatened to retaliate with a ban on all Chinese flights to the U.S. starting on June 16, arguing that China had violated the U.S.-China Civil Air Transport Agreement, which established aviation relations between the two countries in 1980. 

Following this escalation, China retreated from its hard stance in early June and agreed to allow some U.S. flights into China. And last week, the two countries agreed to allow U.S. and Chinese carriers to conduct four flights a week between the two countries. 

But this still represents a huge reduction from normal flight capacity. According to Michael Boyd, an aviation consultant with extensive experience in China and founder of Boyd Group International, nearly 10 million passengers flew between the U.S. and China in 2019. But this year, Boyd estimates that Covid-19 and the resulting travel restrictions may cut that number by about 80 percent, down to 1.5 million passengers. 

A D.O.T. spokesperson told The Wire, “The Department will continue to press for the full restoration of passenger air travel between the United States and China.” But until the restoration of normal flight operations, the American business community is left in the lurch. 

As a result of the commercial flight shortage, some foreign companies have chartered private planes to get employees back into China. In May, for example, the German Chamber of Commerce chartered two Lufthansa flights, each carrying 200 people, to take German nationals and their families back to China. 

Though one passenger on the first charter flight later tested positive for Covid-19, adding a wrinkle to the carefully laid plan, the German Chamber of Commerce has three more flights planned for July. The waiting list for those flights already has a thousand people, according to Jens Hildebrandt, the executive director of the German Chamber of Commerce in north China. (The American Chamber of Commerce says it has not chartered any flights to China for American executives.)

This month, another unexpected challenge emerged for those hoping to relocate to China’s capital city. Beijing is experiencing a Covid-19 flare-up, with over two-hundred new cases originating from a wholesale food market in the city. Hildebrandt, at the German Chamber, said it is too early to tell how this will impact foreigners traveling back to China, but because there were already regulations prohibiting international flights from landing in Beijing, and flights were required to land in neighboring cities to protect Beijing, the new outbreak hasn’t yet impacted flight itineraries. “But who knows what the world will look like in a month,” he said.

Some analysts point to a political element of travel restrictions for American businesses, given the escalating tensions between the U.S. and China over the handling of the coronavirus outbreak. China has signed fast-track visa approval agreements with South Korea, Singapore, and Germany, making it easier for the business community in those countries to receive visa approvals. China has not signed a fast track agreement with the United States.

The State Department declined to comment on this story, but the agency has issued a Level 4 travel advisory for China, warning American citizens, including Americans working in China, against traveling to China due to the pandemic. 

The current travel disruptions will likely impact the future operations of American businesses in China, according to some analysts, including the normalization of working remotely from outside of China. And though many businesses already employ many Chinese nationals in their China operations, that number will likely increase. Some even worry that the pandemic will inflict lasting damage to the business ties between the U.S. and China.

But for now, American businesses with operations in China are only focused on making it out alive. “Companies are certainly grappling with this experience, and will have to make long term decisions in the future,” Margulies said, “But they aren’t there yet.”

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