US, Chinese firms bracing for fallout of Trump’s protectionist trade plans

WASHINGTON: A record number of US companies in China are thinking about moving some operations out of the country or are already in the process of doing so, according to a new study, as geopolitical tensions rise with Donald Trump’s return to the White House.

The annual survey by the American Chamber of Commerce in China found 30 per cent of respondents were exploring alternative sources for goods and relocating manufacturing out of the country last year or had already done so — double the percentage in 2020.

Michael Hart, AmCham China president, said that while the majority of US companies were not moving, the trend towards relocation was unmistakable. US and Chinese companies are bracing for the fallout of Trump’s protectionist trade plans.

While the new US president held off this week on implementing his most serious threats — which have included a 60 per cent blanket tariff on Chinese goods — he has reiterated that Washington could impose a 10 per cent levy from February 1 if Beijing does not crack down on exports of precursors for fentanyl, the deadly synthetic opioid. He has also ordered US officials to review trade with China, including supply chains that use other countries to circumvent tariffs. The AmCham survey conducted between October and November found that 44 per cent of companies that were considering relocation cited US-China trade tensions for doing so.