At China's largest trade fair, businesses brace for impact of trade war with US

Exporters at China’s largest and oldest trade fair on Tuesday said they were concerned about the escalating trade war between the U.S. and China and were looking ahead to other markets.

The Canton Fair opened in the southern city of Guangzhou with some 31,000 companies participating at 74,000 booths, according to state media.

Zhao Xianmei, marketing manager at a company that designs and produces massage chairs, said that 70% of its orders comes from deals made at the Canton Fair.

Nearly one third of products from Bella Intelligent Information Technology Company are sold to European countries and the United States.

“Because of the tariffs, some of our businesses are suspended because of the problems with payment, exchange rates” and other reasons, said Zhao. She remained however optimistic that the friction would be temporary.

“We don’t think this will persist for a long time because it’s unhealthy. So, we are waiting, and we look forward to a revival of market in the future,” Zhao said.

An escalating trade war

US president Donald Trump imposed sweeping tariffs on goods imported to the United States on nearly all countries and territories in the world at the beginning of April.

While several nations attempted to negotiate the tariffs, Beijing countered by raising its own tariffs on US goods to 34%, mirroring the US tariffs.

Washington then escalated by raising its tariffs to a 145% rate. China responded with a 125% tariff, which took effect on Saturday.

Also present at Canton Trade Fair, air-conditioner and fridge manufacturer, Chigo, has been exporting to markets overseas since the 1990s. Now, Chigo products are sold to 180 countries and regions.

Sales manager Liao Shixing said even though the U.S. does not make up a large share of the company’s export market, the wide-reaching Trump tariffs that hit most countries would impact their business. “We will be influenced (by the trade war) in the short term” said Liao, before adding that the company is considering opening new markets in order to offset the impact.

The Canton Fair, held twice yearly in Guangzhou, runs through May 5.