Charts of the Day: Trade War Deals Blow to American Firms in China
American companies in China are getting worried as tensions continue to mount in the trade war between the world’s two largest economies now in its second year.
Three-quarters of such firms said the latest tit-for-tat tariffs levied by the two sides this month have had a negative impact on their business, according to a new survey conducted jointly by the Beijing- and Shanghai-based American Chambers of Commerce, two of the biggest business organizations representing the group.
The survey found that American manufacturers in China were taking the biggest hit, with more than 80% saying they were suffering from both the U.S. decision to raise tariffs on $200 billion worth of Chinese imports annually, and from China’s reciprocal move to raise tariffs on $60 billion worth of U.S. imports. To cope with the clash, about a third of respondents said they are increasingly adopting an “in China for China” strategy. A third also said they were delaying or canceling investment decisions.
As China becomes more expensive for manufacturers in general, the current clash may also be leading many companies to accelerate consideration for relocating some of their business out of the country. Around 41% of the nearly 250 survey respondents said they are considering or have already relocated some manufacturing facilities outside of China. Among those, Southeast Asia and Mexico were the most popular destinations.
No new talks have been scheduled in the current conflict, though U.S. Treasury Secretary Steven Mnuchin said last week he was likely to travel to Beijing soon for another round of trade negotiations amid reescalating tensions.
Contact reporter Yang Ge (firstname.lastname@example.org)
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