A new survey has found that a majority of Chinese consumers are prepared to stop buying US products in response to the Trump administration placing tariffs on Chinese goods.
54% of respondents across 300 Chinese cities would “probably” or “definitely” shy away from US products, the study, conducted by FT Confidential Research, found. Only 13% of the 2,000 who responded said they would not boycott.
The Chinese public has a history of retaliating against the country’s trading partners with their pocketbooks in response to political friction. Most recently, Chinese consumers and tourists lashed out at South Korea for deploying a US-made missile defense system, amid encouragement from state media.
In the case of the ongoing trade conflict with the US, Beijing has been careful not to call for a boycott to US products, a reticence that has been seen by some as a signal that China is keen on restarting negotiations.
Others have pointed out that many US products sold in China are produced there, and sold through subsidiaries that are partly owned by Chinese entities. While US corporations rely on the profits from the huge and growing Chinese market, Beijing might be wary of collateral damage.
In response to the Trump administration’s decision to impose tariffs on US$34 billion in Chinese imports, Beijing imposed matching retaliatory tariffs. Should the US follow through on a proposed second round of tariffs on US$200 billion in goods, China would have to resort to other retaliatory measures as they do not import enough goods form the US to match that number.
This is not the time for gun boat diplomacy. The Chinese are prepared to endure the pain for the future, to achieve their China Dream. Trump only serves to unify the chinese.
" Others have pointed out that many US products sold in China are produced there, and sold through subsidiaries that are partly owned by Chinese entities. While US corporations rely on the profits from the huge and growing Chinese market, Beijing might be wary of collateral damage."
Name me a US product (whether imported or made in china) that cannot be substituted with equivalent chinese made ones. China should seize this opportunity to edge out US made-in-china products.
Take for example, cars. US cars aren’t that great that it cannot be replaced with the latest models from Geely, GWM, BYD, etc. Ok, even supposing buying chinese cars are not cool, there is always BMWs, Mercedes Benzs, Volvos, Rolls Royces, Bentleys, etc. If a boycott truly happens, in no time US branded cars will start to disappear from china’s roads, and thats a bonus for the other manufacturers. In fact, it will be a big opportunity for local car makers to seize a bigger share of the market. They can absorb well trained workers from US manufacturers to cater for expanded demands. Last year china made and sold 28 million cars! GM sold more cars in china than in the US. Local chinese manufacturers only managed to capture about 30% of this market.
The other example is smartphones. Apple makes and sells a big portion of its iphones in china. In fact apple’s share of the chinese market is about 20%. There is virtually no difference between the quality and functionality of Huawei, Oppo, Vivo, Xiaomi, ZTE phones from the iphone. In fact, Huawei phones are outstripping iphones in quality and functions. With iphones gone, chinese brands can monopolise the entire local market. iphones maker like Foxconn can turn to make phones for Huawei, Oppo, Vivo, Xiaomi and ZTE. There is no need to retrench workers and at the same time they can have Apple’s lunch.
The current "false flag" trade war is a direct result of these empire companies operating and making hundreds of billions of dollars in profit in china every year for the last 30+ years. They never reported this fact back to their taxmen. Deutsche Bank reported that the US actually had a trade surplus of USD 20 billion with china in 2017.
So, where is the collateral damage?