American customs duties pushing China factories to search for new markets

Companies and analysts reported that Chinese factories began to stop production and search for new markets with the start of the impact of American customs duties on exports, which negatively affected the volume of requests and jobs, according to the CNBC.
“I know many factories that have asked half of its employees to leave the work for a few weeks and stop most of the production lines,” said Cameron Johnson, the first partner of the Shanghai -based consultant consultant.
Johnson noted that play factories, sports tools, and low -cost commodities were the most affected at this stage.
Also read: How do companies try to escape the high customs duties of Trump?
He added: “Although this activity has not yet spread on a large scale, it is already happening in the main export centers: Yi Woo and Dongguan, and there are real concerns about its increase in the future.”
He explained that there is hope for reducing customs duties to restore requests, but that companies are currently forced to lay off workers and stop production.

Estimates of the size of the affected employment

According to the estimates of “Goldman Sachs”, between 10 million and 20 million Chinese workers work in export -based companies to the United States.
The total number of workers registered in Chinese cities last year reached about 473.45 million workers.
Also read: “Morgan Stanley”: America is the most affected by Trump customs definitions

The trade war between Washington and Beijing escalated

During this month, the United States imposed a successive series of customs duties on Chinese goods, exceeding 100%, and China replied with similar fees.
Although US President Donald Trump confirmed the presence of talks with Beijing, the Chinese side denied any current negotiations.

The effect of customs duties exceeds the effect of the pandemic

“The effect of double the recent customs duties is much larger than the impact of the Kofid-19s”.
Monga pointed out that small companies, which have limited resources that do not exceed millions of dollars, may find themselves out of the market as a result of sudden increases in the fees.
To counter this, Monga launched a website called “Tarif Help” to help small companies find suppliers outside China.

New strategies to confront the crisis

For example, Woodosol for the manufacture of sportswear, based in Ninju, near Shanghai, has turned into direct sale via the Internet inside China, by launching a channel for direct broadcasting of its products.
The company stated that more than half of its production was previously dedicated to the American market, and that a large part of the production capacity will remain idle for two to three months until new markets were built.

E -commerce and compensation for losses

“Bido” announced its cooperation with hundreds of Chinese companies to launch local electronic trade channels, while providing financial support and free artificial intelligence tools for a million companies.
GDD com also allocated 200 billion yuan (about 27.22 billion dollars) to purchase Chinese goods for export and re -marketing them internally.
However, this support covers only a small percentage, estimated at 5%of China’s total exports to the United States, which amounted to $ 524.66 billion last year.

Continuous challenges and future expectations

“Some companies have informed us that their business model is no longer to continue with customs duties of 125%,” said Michael Hart, President of the American Chamber of Commerce in China.
Hart pointed to the intensification of competition between Chinese companies during the past week, suggesting that customs duties between the two countries remain for a long time, with the possibility of granting exceptions to some sectors.