THE ADVANTAGES AND DISADVANTAGES BROUGHT BY THE TRADE WAR BETWEEN CHINA AND THE UNITED STATES TO THE BAG INDUSTRY

20-06-2019

On July 6, 2018, at 12:00 Beijing time, the US government officially began to impose tariffs on about 1,300 Chinese goods worth 34 billion US dollars, initiating the largest trade war in human economic history. The first industries involved in aerospace, information and communication technology, robotics, medicine and machinery.

 

Why would the US start a trade war?

 

1. Reduce the trade gap between China and the United States.

2. Limit the growth of China's technology sector and slow the recovery of manufacturing.

3. Protect local American businesses.

 

Why does the US have the 'capital' to start a trade war?

 

1. The dollar is the global currency.

2. The US still owns most of the intellectual property rights of core technologies and brands.

3. Most of China's light manufacturing industry is still in the process of low profit

 

What factors may affect the bag industry?

 

1.       US dollar exchange rate: the US dollar continues to appreciate strongly in the global market. At present, most of China's luggage and bag industry is still in the stage of OEM, processing, low profit and high turnover. While, China's central bank responded promptly to the dollar-renminbi exchange rate, other emerging market currencies were hit hard, indirectly affecting demand for Chinese imports.

 

2.       Additional duties: China on Monday announced that it will raise the rate of additional tariffs imposed on some of the imported US products from June 1. China had earlier imposed additional tariffs on 60 billion dollars worth of US imports, the rates of additional tariffs on some of the products will now be increased to 25 percent, 20 percent, and 10 percent, according to a statement by the Customs Tariff Commission of the State Council.and bag industry increase tariffs 10 percent to 22 percent .

 

How does our company WORTHFIND deal with the crisis?

 

1. Negotiate with customers about the impact of exchange rate changes and make a win-win plan.

2. Enhance the independent brand awareness and enhance the competitiveness of intangible assets.

3. Improve our bag quality and enhance bag tangible competitiveness.

 


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