I’m an American in China but have been seeing very little foreign reporting about what’s happening in China, which is weird to me because it seems pretty important to get a clear picture of the trade war. So here’s what I learned from him.
Gov support
-The local government is helping and giving him low interest rate loans / short term financial support. This type of thing is very common throughout China right now – lots of local govs are mobilizing to support exporters thru the tariff war. Li Qiang, central gov minister, says central government help is probably coming too
-Guangzhou, and I assume others too, has also organized tons of seminars since Liberation Day with buyers from Europe, Latin America, and Asia. A big source of replacement demand for his factory has been from these
-He’s getting lots of buyers from TikTok shops overseas. It seems like TikTok is helping a lot to mitigate the demand impact
-The news story of Walmart, Target, Costco, etc. resuming some orders is true, he confirmed it. But the amounts are very, very small
Pain
-He’s already re-evaluating employees and firing some soon. He said most exporters in Guangzhou are cutting some employees, but extremely US dependent exporters have furloughed most of their workforces until mid May
Some good news for the U.S?
-Before Liberation Day he was building a factory in the US and has now fully committed to it. But it’s having issues since the raw materials are sourced from China and they’re getting hit with tariffs
The full interview is here, I didn’t write everything here. Knowing the relative strength and ability of China or the US to withstand the tariff war is super important to trading right now I believe.