High tariffs force out the ultimate form of the "China model"! Counterattack at sea: from "beaten" to "make rules"!
On March 4, 2025 local time, U.S. President Trump reiterated in a speech at a joint session of Congress that reciprocal tariffs would begin on April 2. Tariffs on agricultural products also came into effect on April 2.
Trump said that other countries have been imposing tariffs on the United States for decades, and now it is the turn of the United States to start imposing tariffs on other countries, which is considered the most far-reaching and impactful tariff policy of the current U.S. administration.
On the eve of the implementation of the U.S. tariff policy, many parties expressed their opposition to it.
Direct economic pressure on Chinese exporters
Orders and profits shrank
Labor-intensive industries (textiles and garments, furniture, toys) and machinery and equipment industries bear the brunt. After the tariffs are stacked, the total tax rate on Chinese exports could be as high as 81.5% (base tax, 301 tariffs, Trump tariffs, new equivalent tariffs), resulting in a sharp decline in export orders and profit margins approaching zero.
The cost of cross-border e-commerce has surged
The termination of the U.S. duty-free policy for small parcels under $800, coupled with a 30% tariff or a fixed tax on a single item (rising to $50 per piece after June 1), has led to an increase in cross-border e-commerce logistics costs and a longer customs clearance time, making it difficult to sustain business in the U.S. in the short term.
Supply chain adjustment and industrial differentiation
Southeast Asia's "safe havens" fail
Southeast Asian countries (e.g., Thailand, Vietnam) are also included in the scope of high tariffs (24%-49%), which weakens the tax avoidance value of Chinese enterprises to build factories overseas.
Accelerate the restructuring of the industrial chain
Low-end industries are under pressure to be eliminated: Traditional labor-intensive industries may be forced to withdraw from the U.S. market or turn to the OEM model.
Autonomy of high-end manufacturing: semiconductors, new energy vehicles and other industries will accelerate technological upgrading and domestic substitution, and reduce dependence on U.S. technology.
Emerging market opportunities: New energy (photovoltaics, lithium batteries), artificial intelligence and other fields have become the direction of enterprise transformation due to the growth of global demand and the breakthrough of technical barriers.
Corporate response strategies and market turns
Price increases and cost pass-through: Some companies have responded to tariff pressures by raising prices quickly, and it is expected that the whole industry will follow suit with price increases to maintain profit margins.
Market diversification: Enterprises are accelerating their expansion into emerging markets such as Southeast Asia and Europe to diversify risks, while enhancing their competitiveness through brand premiums and supply chain localization.
Employment and long-term economic impacts
Short-term employment shock: Reduced export orders could lead to layoffs in labor-intensive industries, especially in areas such as textiles and electronics manufacturing, which rely on the U.S. market.
Long-term structural adjustment: The pressure is forcing industrial upgrading, promoting enterprises from "low-cost dependence" to "value competition", which may give rise to a high-end industrial chain with global competitiveness.
Key Disputes and Challenges
Southeast Asia's production capacity dilemma: Although overseas factories can partially avoid tariffs, it is still difficult to achieve profitability due to the new tax rate on local production costs.
Policy uncertainty: The U.S. tariffs continue to exert pressure, and companies need to dynamically adjust their strategies and bear additional compliance costs.
To sum up, Trump's tariff policy has a dual effect of "short-term heavy pressure and long-term pressure" on Chinese overseas enterprises, and traditional industries are facing an existential crisis, but high-end manufacturing and emerging industries may take the opportunity to achieve global upgrading.
Companies need to accelerate breakthroughs in supply chain resilience, market diversification, and technological autonomy.
Resolute countermeasures! An additional 50% tariff!
Due to the impact of Trump's tariff plan on Chinese enterprises, the Customs Tariff Commission of the State Council of China stated that the US escalation of tariffs on China is a mistake on top of a mistake, which seriously infringes on China's legitimate rights and interests and seriously undermines the rules-based multilateral trading system.
Therefore, from 12:01 on April 10, 2025, the additional tariff measures on imported goods originating in the United States will be adjusted. The relevant matters are as follows:
1. The additional tariff rate stipulated in the Announcement of the Customs Tariff Commission of the State Council on Imposing Additional Tariffs on Imported Goods Originating in the United States (Tariff Commission Announcement [2025] No. 4) will be adjusted from 34% to 84%.
The United States wields the stick of tariffs, and China fights back with its sword! This is a crisis, but also an opportunity for Nirvana to be reborn!
Made in China, we have never been afraid to fight a tough battle - because the strongest hole card is ourselves!
