It Is Difficult For Enterprises To Cope With The Attack Of Tariffs Trump Threatens To Levy Tariffs, Which Makes American Enterprises Also Difficult

As the saying goes, "There is no good war and no bad peace". Once a trade war starts, there will be no real winners. Once Trump imposed a 45% import tariff on China, not only Chinese enterprises will suffer, but also American multinational companies doing business in China. Trump may have the right to break trade rules, but this will run through the whole supply chain, not only harming Chinese manufacturing and American consumers, but also facing the global trade rules and systems regulated by the WTO.

Because of the rising Labor cost With increasingly strict environmental protection supervision, thousands of small and medium-sized enterprises in China have already faced difficulties in operation. However, President Trump of the United States threatened to impose high tariffs on Chinese exports, which may make it difficult for these enterprises to continue to operate. According to the report, at present, among the glass companies operated by Boss Li in Huizhou, three of the four furnaces are in a state of shutdown. Due to the decline in exports, the number of workers has dropped from 1000 10 years ago to 150 now, and the profit space has been shrinking. Boss Li said that the company run by his father is now on the verge of death. He said, "We can no longer bear the extra costs. If we collect tariffs again, we will be finished."

According to the report, thousands of other small and medium-sized enterprises in China are also facing the same dilemma. The rising wages of workers and more stringent environmental protection laws have made them suffer. If the tariff policy of up to 45% threatened by President Trump of the United States is finally introduced, many business owners will have to shut down production or sell factories. These factories mainly export clothes, toys and household goods to the United States. These products are 462.8 billion dollars of China's annual exports to the United States Trade volume However, due to the lack of cash flow, it is difficult for these enterprises to cope with the impact of tariffs and to shift their business activities to Southeast Asia.

Data shows that in 2016, China's total exports to the United States accounted for 18% of all exports. Relevant data show that the industries with high export volume of China include furniture, electronic products, textile and clothing, leather products and electrical equipment manufacturing. The gross profit margin of each industry is almost lower than 45%, which means that once the United States imposes 45% tariffs, China's exports to the United States may be completely stopped.

However, once all Chinese exports to the United States stop, the United States will also be seriously hurt. Chen Sijin, a senior financial risk consultant of a Canadian bank, said in an interview that, according to the speculation of the National Institute of Finance of China, the added value of exports accounted for about 10% of China's GDP, and the United States accounted for nearly one fifth of China's exports. So, Trump Once the 45% import tariff imposed on China is implemented, not only China will feel pain, but also American multinational companies doing business in China, including investment banks on Wall Street, will feel pain. For both China and the United States, it is a lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose lose.

Take Apple and Microsoft for example. In the past 15 years, China has been the manufacturing center of large diversified technology companies such as Apple and Microsoft, specializing in hardware and software manufacturing. The Chinese people are famous for their fineness of details and technology in manufacturing high-quality goods. However, levying VAT on goods made in China will encourage multinational companies to reassess whether it is still meaningful for them to make in China, or whether they will reduce their business? In fact, the answer is obvious. For China and the United States, it will be a win-win situation.

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