In January 2018, the business world was rocked when it was revealed that the U.S. had imposed a tariff on Solar Panel imports, a majority of which was produced in China. This set in stone a series of tariff implementations, that led to a US-China trade war. This development has gone on to have effects worldwide.

US-China Trade War

US-China Trade War


What was the reason for the US-China Trade War?

For the United States, the tariffs were imposed as part of U.S. president Donald Trump’s protectionist agenda. These tariffs were imposed in order to protect the intellectual property of U.S. businesses, and to help reduce the U.S. trade deficit with China. China, meanwhile, set their tariffs in retaliation to the United State’s prior tariffs imposed.

This therefore led to the US-China trade war. Unfortunately, the trade war does not look like it will end anytime soon. This is because neither party looks like it will back down from its stance.

What are the impacts of the US-China Trade War?

The main impact of the US-China trade war is an increase in production costs. For instance, it would cost an American company significantly more to source its products from China. Notable industries affected by the tariffs include the automobile, metal, and medical industries. Major companies in the world that have operations in China, such as Apple, could also be severely affected.

The tariffs also negatively affect the world economy. By 2020, world economic growth rates could drop by 0.5% as a result of the escalation of tariffs.

How would it affect your company?

The US-China trade war would affect your company if your company has operations between China and the United States. Importing from China to the United States, or vice-versa would cost more due to the increase in tariffs imposed, and this can have a series of negative effects on your company. This stems from profit margins, to marketing budget problems due to increased production costs, and even production delays.

What is The ODM Group doing about this?

Recently, The ODM Group has opened a new office in Ho Chi Minh City, Vietnam. In line with this, our company is also looking to increase the amount of Vietnamese suppliers that we work with. This would benefit our clients, as Vietnam has healthy relationships with both the United States and China. Furthermore, production costs in Vietnam are lower than China. A combination of both factors will help drive production costs down, thus benefiting our clients.

So if you are in need of low-cost sourcing and manufacturing of promotional products speak with our team! Here at The ODM Group, we specialize in providing our clients with custom promotional products. If you have any inquiries, feel free to contact us!

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