According to a report published by MarcumBP based on a joint research with Tsinghua University, the U.S. is no longer the preferred destination for private companies in China when it comes to investments and initial public offering (IPO) listings.

The research also indicated that 66% of mainland business leaders see China as the most attractive destination for listings, compared with only 18.7% who prefer the U.S.

Based on the survey results, although nine Chinese firms continue to select the U.S. exchanges for their IPO, in general the number of Chinese companies listing on Nasdaq (QQQ  ) or the NYSE has fallen to 18 by far this year, down from 26 the same time in 2018.

The report predicted that this trend could continue, as recent rhetoric from Washington has created a more hostile environment for Chinese firms looking to go public in the U.S.

Last week, the U.S.-China Economic and Security Review Commission (USCC) proposed measures restricting U.S. capital flows towards Chinese companies. In a 2019 report submitted to Congress, USCC stated that sustained Chinese investment in cutting-edge sectors in the U.S. raises concern for U.S. policymakers. USCC recommends that Congress establish legislations to preclude Chinese companies from issuing securities on U.S. stock exchanges if their disclosure is inadequate and doesn't conform to U.S. rules.

This constraint and sentiment was largely echoed and agreed by 66 percent of the 1,200 business leaders surveyed across China, compared to just 18.7 percent that viewed the U.S. as an attractive IPO destination, behind even the likes of Hong Kong despite ongoing unrest.

Meanwhile, China has been working relentlessly on boosting the appeal of its domestic stock markets, promoting Shanghai in particular as a destination for finance. In July, Shanghai launched the STAR Market-a Nasdaq-style bourse in Shanghai that permits pre-profit IPOs for science and technology companies.

China's eagerness to develop Shanghai as a financial center is partly motivated by a desire to have an onshore alternative to Hong Kong-which has a judiciary and monetary authority largely separate from that in mainland China and is the leading destination for IPOs globally.

On the other hand, while many mainland Chinese executives do not consider the U.S. when making listings or investment decisions, the interest of U.S. investors in rapidly-growing Chinese tech unicorns is undiminished. At the same time, several Chinese firms still rely on access to the U.S. capital markets when it comes to securing funding, including companies such as, Iqiyi, Huya and other prominent companies from China.

The survey also showed that despite the trade tensions, Chinese CEOs remain committed to global expansion, but have shifted their focus from the U.S. to Southeast Asia, Europe and Africa.