Small businesses in China can be affected by Trump’s Tariff

Small/medium factories could be affected if Trump slaps a levy on Chinese products that could reach 45%. This will distroy will make the most of the business-makers to change their plans.
Old business makers are now in a black period. Most of them have their firm inborn from their parents. Now they have less workers than they should and their profit is close to zero.
This is the case of Huizhou Baizhan Glass Ltd.’s. Li, the owner, said that the company’s idea started from his Taiwanese father in 1991, now being in danger to colapse. From 1,000 workers he has 150 and his contracts are shrinking.
“If there’s a tariff, it’s game over for us,” said Li, 42. “We don’t have the ability to take on extra costs.”
This a general situation, where people are trying to find a way to stabilize their income.
“Smaller companies tend to be focused and not diversified like big players are,” said Karel Eloot, a senior partner at McKinsey & Co. in Shanghai. “They would be the most exposed and dependent on whatever happens with U.S import duties.”
Trump has accused China of unfair trade practices and currency manipulation. His accusations were put in Commerce Secretary Wilbur Ross attention. He said that all the measures will be public “as soon as we have a proper case prepared.”
Boeing airplanes, iPhones and soybeans could be put at bigger prices for US as a replica for their attitude.
“President-elect Trump specifically mentions on his website that he would offer a one-time tax repatriation holiday of 10 percent for cash held offshore,” Gene Munster, senior research analyst at Piper Jaffray, said in a Nov. 17 research note. “This most obviously helps Apple, who held $216 (billion) in cash and marketable securities through foreign entities as of September 2016. Google
would also benefit, holding $49.7 billion. ”
China exported about $482 billion in goods to the United States in 2015, more than any other country exported to the U.S., according to the Office of the United States Trade Representative.
“There’s too much at stake for both countries to engage in a trade war,” said Eddy Li, president of the 3,000-member Chinese Manufacturers’ Association of Hong Kong. “Although we are concerned about such a scenario, we also feel optimistic.”
“Even a 10 percent tariff increase will make it difficult for Chinese factories to cover their costs,” Leung said. “If they stay, they just plan to sell their factories at a good price and end their businesses.”

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