U.S. Become Destination for Chinese Manufacturers Due to Trade Disputes
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Chinese manufacturers are diving into the U.S. market, setting up shop in various sectors, from petrochemicals to souvenirs, in an effort to dodge the fallout of the fierce trade war that's brewing between the two economic giants. According to the South China Morning Post, these industrious Chinese entrepreneurs see the U.S. as a refuge from burdensome tariffs that have skyrocketed up to a staggering 145%.
Leo Li, the head of an electronic components company from Shenzhen, has already set up a factory in Nevada, believing that a hike in costs is easier to swallow than the massive tariffs looming in the crossfire. And a gift producer is scouting warehouses, trying to streamline logistics and secure work visas for his staff to establish production in Dallas come May. He admits, "The U.S. market makes up almost 95% of our orders. It's a market we can't afford to lose."
The petrochemical industry seems especially captivated by the US, as previously importing raw materials from the States and exporting processed products resulted in double taxation. According to the founder of the Beijing consulting firm Chem1, setting up factories in the U.S. could offer substantial benefits to this sector. Ye Minming went on to explain that, for petrochemical processing where raw materials account for 80-90% of the total costs, even a 10% tariff can cause significant ripples.
The trade war between the U.S. and China has been simmering ever since Donald Trump took the government's reins. As of 2025, the tariffs on imports from China to the U.S. have rocketed past the 10x mark. The current tariff is a daunting 125%, but the U.S. is rumored to be weighing a possible increase to an alarming 245%. As a countermeasure, China has enforced a similarly steep tariff on U.S. goods and declared they will no longer pay heed to any subsequent tariff increases, viewing them as unprofitable for the country.
In a twist of events, Donald Trump himself announced a "significant" reduction in tariffs on April 23 (as per the Washington Post), with the U.S. President hinting at rates falling to the range of 50-60%. The IMF predicts that U.S. GDP growth will slow down to 2.7% in 2025 and 2.1% in 2026, largely influenced by the ongoing trade war.
Previously, our platform reported on Vladimir Putin's warning at the Russian Union of Industrialists and Entrepreneurs (RSPP) congress, stating that "free trade will not return". With over 28,595 restrictive measures against Russian businesses, Putin was certain that the West would continue to pressure Russia by such means.
Interestingly, the Russian Export Center has identified markets where Russian exports could surpass European producers. For those scouring for fresh updates on global trade and politics, don't forget to sign up for our Zen.News email newsletter or join us on Telegram and VKontakte. Stay informed and stay ahead!
- Zhou, the gift producer, warned, "The U.S. market is a market we can't afford to lose," as he struggled to find a suitable warehouse in Dallas and secure work visas for his staff.
- Despite the ongoing trade war, Leo Li, the head of an electronic components company from Shenzhen, has already set up a factory in Nevada, acknowledging that the increase in costs might be easier to handle than the tariffs.
- In 2025, the tariffs on imports from China to the U.S. have rocketed past the 10x mark, causing significant ripples in the petrochemical industry, as explained by Ye Minming, the founder of the Beijing consulting firm Chem1. I'm not sure if they will remain at that level, as Donald Trump recently announced a "significant" reduction in tariffs.
