Trump Tariff Impact: The Shenzhen E-Commerce Association, representing over 3,000 Amazon sellers, has called the US tariffs on Chinese goods an “unprecedented blow.” The association, which plays a significant role in China’s e-commerce sector, expressed deep concerns about the impact of the tariffs on small and medium-sized businesses. According to the group, the new trade barriers could lead to the “collapse” of many businesses, further accelerating unemployment in China.
US President Donald Trump on Wednesday announced that the US had hiked China tariffs to a whopping 125%.
Some Chinese sellers are still shipping to the US while others are searching for alternatives, Shenzhen E-Commerce Association says.
The association highlighted that the tariffs will ‘collapse’ small and medium size businesses for sellers to survive in the US market. The Shenzhen E-Commerce Association also warned that the tariffs would exacerbate China’s unemployment problem, especially in the tech and manufacturing sectors.
UBS research suggests that China’s equity market faces downside risks in the short term due to the trade tensions. A 54% tariff hike could dent corporate earnings by up to 3% if the total tariff is raised to 104%, as the US accounts for 3% of the revenue of MSCI China-listed companies. Despite these challenges, UBS maintains an “Overweight” rating on the internet and consumer sectors, citing possible consumption policy stimulus.
(With Reuters inputs)