More than 70 percent of U.S. firms operating in southern China are considering delaying further investment there and moving some or all of their manufacturing to other countries as the trade war bites into profits, a business survey showed on Monday.
U.S. companies operating in China believe they are suffering more from the trade dispute than firms from other countries, according to the poll by the American Chamber of Commerce in South China, which surveyed 219 companies, one-third from the manufacturing sector.
Sixty-four percent of the companies said they were considering relocating production lines to outside of China, but only 1 percent said they had any plans to establish manufacturing bases in North America.
“While more than 70 pct of the U.S. companies are considering delaying or cancelling investment in China, and relocation of some or all manufacturing out of China, only half of their Chinese counterparts share the same consideration,” the AmCham report said.
The trade war is shifting both supply chains and industrial clusters, mostly towards Southeast Asia, the survey found.
U.S. companies reported facing increased competition from rivals in Vietnam, Germany and Japan, while Chinese companies said they were facing growing competition from Vietnam, India, the United States and South Korea.
Customers are slowing down orders or not placing them at all, Harley Seyedin, president of AmCham South China, told Reuters.
“It could very well be that people are holding back on placing orders until times are more certain or it could very well be that they are shifting to other competitors who are willing to offer cheaper products, even sometimes at a loss, in order to get market share,” he said.
“One of the most difficult things about market share is once you lose it, it is very hard to get back.”
Companies in the wholesale and retail sectors have suffered the most from U.S. tariffs, while agriculture-related businesses have been most hit by Chinese measures, the survey found.
The survey was conducted between Sept. 21 and Oct. 10, shortly after the U.S. imposed tariffs on another $200 billion worth of Chinese goods. That prompted Beijing to retaliate with additional tariffs on $60 billion of U.S. products, escalating a tariff war between the world’s two largest economies.
The U.S. duties are set to rise sharply on Jan. 1.
Both Washington and Beijing appear to be digging in for a long battle, though U.S. officials say President Donald Trump would go through with plans to meet Chinese President Xi Jinping at the G20 summit next month if it looked like the discussions would be positive.
Nearly 80 percent of the survey respondents said the tariffs have knocked their businesses, with U.S. tariffs having slightly more impact than the Chinese ones.
Around 85 percent of U.S. companies said they have suffered from the combined tariffs, compared with around 70 percent of their Chinese counterparts. Companies from other countries also reported similar impacts as their American counterparts.
The top concern of companies surveyed was the rising cost of goods sold, which resulted in reduced profits. Other concerns included difficulties managing procurement and reduced sales.
One-third of companies estimated the trade dispute had reduced business volumes ranging from $1 million to $50 million, while nearly one in 10 manufacturers reported high-volume business losses of $250 million or more.
Nearly half the companies surveyed also said there had been an increase in non-tariff barriers, including increased bureaucratic oversight and slower customs clearance. Analysts have warned of such a risk to U.S. firms as China is increasingly unable to match U.S. measures on a dollar for dollar basis.
The survey’s findings add to evidence that export-reliant Chinese cities and provinces are facing growing strains. Guangdong, China’s biggest province by gross domestic product, reported a drop in exports in the first eight months from a year earlier.
New Zealand: 49 Killed In Mass Shooting At Two Mosques In Christchurch
49 persons have been killed and 20 seriously injured in two mass shootings at mosques in the New Zealand city of Christchurch.
Forty-one were killed at the al Noor mosque. Seven died at the Linwood mosque, and one person died at the hospital.
Police say four persons, including three men and one woman, have been taken into custody. They do not believe there are any other suspects but said it was still an open investigation.
Police said a male, in his late 20s, has been charged with murder and will appear at the Christchurch court Saturday morning local time.
In a social media post just before the attack, an account that is believed to belong to one of the attackers posted a link to an 87-page manifesto that was filled with anti-immigrant, anti-Muslim ideas and explanations for an attack. The manifesto was not signed.
Britain Votes In Favor Of Delaying Brexit
Britain’s parliament has voted in favour of delaying by three months, UK’s departure from the European Union pending approval of Prime Minister Theresa May’s Brexit deal within a week.
MPs in the house of commons voted four hundred twelve to two hundred two on Thursday in Favour of a government motion proposing pushing the UK’s exit from the bloc beyond the scheduled March the 29th date.
The motion said the government would seek a “one-off extension” until June the 30th “for the purpose of passing the necessary EU exit legislation,” provided May’s widely maligned deal wins parliament’s approval by Wednesday next week.
If May fails to win parliamentary approval for her deal by march 20, the Brexit delay could be extended beyond three months. Twice now, British legislators have overwhelmingly rejected her EU divorce deal.
Israel Launches Gaza Air Attacks After Rockets Fired At Tel Aviv
Israel launched air attacks on Gaza hours after rockets were fired aimed at Tel Aviv.
This has raised fears of a major escalation in the Israeli-Palestinian conflict.
Explosions were heard in the Gaza strip early on Friday and Palestinian witnesses said Israeli planes bombed Hamas security positions.
A Gaza Palestinian security source told AFP news agency about 30 raids targeted positions held by the military wing of Hamas and its ally Islamic jihad, causing significant damage.
Local Palestinian agencies reported a woman and her husband were both injured in the southern city of Rafah, but did not provide further details.
Israeli military said it was attacking “terror sites” in Gaza, hours after it said two rockets were launched from the enclave in the Tel Aviv area.
- Group Seeks Compensation For Building Collapse Victims In Lagos, Oyo March 18, 2019
- Building Collapse: Lagos Demolishes 13 Buildings March 18, 2019
- 10 Killed In Attack On Kaduna Community March 18, 2019
- Proposal For UN To Study Climate Technologies Rejected March 18, 2019
- Tanzania: Stiegler’s Gorge Hydro-Electric Project To Produce Thousands Of Jobs March 18, 2019
Sports News7 days ago
Gambia Launches Appeal Over Olufade’s Eligibility
Education News4 days ago
JAMB Fixes April 11 For 2019 UTME
Sports News6 days ago
DR Congo Mbokani Recalled Ahead Of AFCON Qualifier
African News5 days ago
Trump Proposed Budget Deeply Cut Aid To Kenya
Sports News7 days ago
FIFA Urged To Probe Qatar World Cup Accusations
African News3 days ago
Cameroon: U.S. Official Calls On Cameroon To Release Opposition Leader
Nigerian News3 days ago
NNPC Awaits Order To Take Over OML From Shell
Business News5 days ago
Boeing Shares Continue To Slide As Countries Ground 737 MAX Planes