US President Donald Trump sent out a tweet this week that the US has already won the trade war against China, and leaders are scrambling to negotiate a peace deal.
The first casualty in war is always the truth, and leaders on both sides are going to make it seem they are the real victors. One thing is for sure; the war has only just begun.
The US fired the first shot on July 6 by officially implementing a 25% tariff on US$34 billion worth of Chinese imports. The China Customs Tariff Commission (CCTC) of the State Council immediately retaliated by imposing tariffs on 5,207 certain imports originating in the United States.
There will certainly be casualties on both sides. China is not immune. According to IDC, the impact of the trade war on the Chinese economy will directly and indirectly involve almost all industries. The manufacturing industry will be hit the most, especially in those areas related to the “Made in China 2025” industrial policy, and the services sector, especially technology services.
To this end, RT Media contacted some Chinese companies within the print consumables industry, asking for their comments on this particular issue.
Most China industry leaders believe the trade war will not affect the Aftermarket industry, or at worst, the impact will be very minimal. Certainly at this stage. This is what they told us:
- “This will really hurt industry giants like Hewlett-Packard in the United States and other US printer OEMs wanting a piece of the growing China market,” one industry leader told RT Media. The person who wishes to remain anonymous added, ”At a time when the OEMs are looking for ‘a bigger slice of the cake’ due to a flattening industry in the USA and Western Europe, they are looking at thriving markets like China, but now they will have to pay more, or their customers will in order to get into this market. China is a cut-throat market when it comes to pricing so these big US brands are going to hurt. I cannot imagine they are happy with this US-China trade war.”
- Arnald Ho from Print-Rite, commented, “This problem is complicated because we don’t know exactly what is in Donald Trump’s mind: whether he just simply and purely is using this trade war to push China to be compromised on the trade deals he wants. Or does he and his administration have another hidden agenda beyond the trade balance which may affect the political situation in China. If so, then this will be more difficult to predict. But as everyone knows there will be no winner in a trade war: both parties will be hurt. In relation to Aftermarket printing supplies, I don’t think the products being imported into the USA from China can be replaced by the USA industry today. In the end, the USA still needs to buy from other countries, particularly in Asia, otherwise the American consumer is going to have to pay more for their daily needs.”
- Pantum Technology predicted: “This will exert a huge impact on overseas printer brands as many printers and copiers in the US market are manufactured in China. That means US printers and copiers market will face the pressure of up to 25% increase in price.”
- PrintMax Printing Consumables pointed out, “Aftermarket products are much cheaper than the OEM products. It will not bring any dramatic change even though 25% tariffs are being added to the Aftermarket retail price. Further, other countries cannot copy the Chinese aftermarket in a short term. Yes, the prices of goods imported into America will increase but US consumers are going to be the ones that are hit, not the Chinese. Certainly in the foreseeable future.”
- CET, on the other hand, believed “the tariff policy will exert huge impact on those companies who do not wish to abandon the US market, especially those who enjoy comparatively large market shares in the US. The 25% tariff will devastate many Chinese companies’ strengths in competition, which may cause many to drop out the market.”
Merritt Blakeslee, an international trade and intellectual property law expert specializing in patent litigation at the U.S. International Trade Commission, will share more on the US-China trade war in the 13th RemaxWorld Expo Summit on Oct 17 in Zhuhai.
Register here to meet him in person.