Trade escalation encourages Chinese companies to expand in the U.S. market
The “South China Morning Post” reported that many Chinese companies operating in various sectors have started relocating their activities to the United States, in an attempt to avoid the consequences of the escalating trade tensions between the two countries.
Zhou Ning, the director of a consultancy helping Chinese companies localize production in the U.S., mentioned that he has received over 100 inquiries in just the past four months, which equals the total inquiries he received last year.
Ryan Zhou, the owner of a gift manufacturing business in eastern China, pointed out that the U.S. market represents about 95% of their orders, emphasizing that “it is a market they cannot afford to lose.” He added that he plans to open a new factory in Dallas, Texas, noting that labor regulations in the U.S. are much stricter than in China, but he intends to manufacture only products that require minimal manual labor.
In turn, Yi Yinmin, the founder of Chem1 Consultancy in Beijing, said that building factories in the U.S. is a logical step, particularly for petrochemical companies under the current circumstances, as the tariffs on raw materials, which account for 80% to 90% of production costs, have a significant impact even if the tariff is only 10%.
