US companies in China are ‘suffering’ in trade war, survey says

Kenny Grant
September 15, 2018

The United States only imported $505 billion in goods imported from China previous year.

Companies reported the tariffs were pressuring profits, reducing demand for their products and driving up production costs.

Trump threatened a third tranche of tariffs on another $267 billion of Chinese imports last week, which would mean levying duties on almost everything China exports to the U.S. Trump said at the time those tariffs were "ready to go on short notice", but the administration hasn't yet published a list for public comment.

Every year, the USA imports $500 billion worth of goods from China, while it ships only one-third of that amount to the East Asian country.

The U.S. has enjoyed near-record low joblessness and faster economic growth in 2018, while Beijing's economy faces growing long-term concerns, including a sharp decline in the value of its currency.

The European Union Chamber of Commerce in China released its own survey on Thursday saying the tariffs were causing "significant disruptions" to global supply chains and "seriously impacting" non-Chinese and non-American companies.

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The decision also comes despite a Treasury invitation earlier this week to senior Chinese officials, including Vice Premier Liu He, for more talks to try to resolve trade differences between the world's two largest economies.

"Tariffs are already negatively impacting United States companies and the imposition of a proposed $200 billion tranche will bring a lot more pain", Eric Zheng, chairman of the American Chamber of Commerce in Shanghai, said Thursday in a statement.

It said the timing for activating the additional tariffs was still unclear.

The US leader has mentioned another US$200 billion worth of Chinese imports - and all other Chinese imports to the US market - but analysts believe the administration will change course and the situation will shift after the US mid-term elections in November. More than half of U.S. firms are already feeling Beijing's wrath from non-tariff measures like heightened regulatory scrutiny, more inspections and slower customs clearance, according to the survey. -China talks would delay the duties. "China trade relations, address long-standing inequities and level the playing field", Zheng said in a statement.

According to Bloomberg, the president instructed aides to move forward with the tariffs despite a recent Treasury letter to Chinese officials requesting a new round of trade talks. The White House is pushing tariffs as a powerful negotiating tool for winning what it says are better trade deals for all Americans.

The Journal reported that the USA reached out because of political pressure on Trump to ease up on trade fights ahead of November's midterm elections. "There's some discussions and information that we received that the Chinese government - the top of the Chinese government wished to pursue talks". However, he added, "we can do so through means other than blanket tariffs".

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