by supplychainreport
Many small and medium-sized businesses in China are feeling the strain of ongoing tariffs placed on Chinese goods entering the United States. With additional levies still in place, production lines have slowed, and warehouses are filling up with unsold goods.
At the recent Canton Fair in Guangzhou, a major international trade exhibition, business owners shared how the prolonged trade policy measures have impacted their operations. Among them is Lionel Xu, head of Sorbo Technology, a company producing mosquito repellent kits, previously popular with large U.S. retailers. “This is hard for us,” Xu said, noting that about half of his company’s sales are tied to U.S. buyers.
Similarly, Amy, a representative of Guangdong Sailing Trade Company, reported that her firm has halted production of ice cream makers due to limited market access. “All the products are in the warehouse,” she said, highlighting the widespread logistical challenges many businesses are now facing.
While some U.S. tariffs were temporarily paused last week following financial market volatility, those applied to many Chinese exports remain active. In response, China has kept its own counter-tariffs in place on U.S. imports.
This ongoing trade tension is especially concerning for the approximately 30,000 businesses exhibiting at the Canton Fair. For many, the cost of shipping products to the U.S. market with added tariffs has become unsustainable, forcing them to either reduce operations or seek buyers in alternative regions.
Some companies are actively pursuing new markets in Europe, the Middle East, and Asia. “We hope to open the European market. Maybe Saudi Arabia,” Amy added.
Despite efforts to shift focus domestically, some Chinese enterprises continue to face economic headwinds. China’s export-driven economy—where goods exports accounted for a significant share of recent growth—has seen slower domestic spending amid a cooling property market and post-pandemic financial caution.
In Guangdong province, workers in local manufacturing hubs shared their concerns over reduced job opportunities and lower wages. “Things are not going well,” said one worker near a shoe factory, indicating that daily wages have significantly decreased compared to previous years.
Though larger manufacturers have diversified to countries like Vietnam, many small Chinese producers remain focused on serving both international and domestic customers.
Business leaders at the fair expressed uncertainty about the future of bilateral trade, but some remain cautiously optimistic. “Maybe it will get better in a few months,” Xu said.
Meanwhile, with limited dialogue reported between Beijing and Washington, many industry observers are watching closely for any signs of renewed negotiations.
#ChineseBusinesses #USTariffs #GlobalTrade #ExportChallenges #SupplyChainNews
