In Dongguan, China, Danny Lau’s aluminum-coating factory is grappling with the impact of escalating tariffs initiated during former U.S. President Donald Trump’s administration. Lau, a Hong Kong businessman who established his factory in mainland China in the 1990s, described the current trade war as the most challenging economic period he has faced. During Trump’s first term, the factory endured a 25% tariff, which escalated further this year with the U.S. imposing sweeping 145% tariffs and China retaliating with 125% tariffs. For Lau’s business, this translated to a 75% tariff on his products. One-third of Lau’s clients are from the U.S., and while some clients continue purchasing materials for ongoing projects, prospects for future business are uncertain. In response to the tariffs, Lau’s company, Kam Pin Industrial, has begun exploring opportunities in new markets, particularly in the Middle East. Despite efforts to diversify, Lau finds the U.S. market challenging to replace due to its high purchasing power and demand for quality and punctual delivery. Other Chinese exporters have similarly shifted focus to developing economies in Southeast Asia, Latin America, and the Middle East. Zou Huajian, an executive at Zhuoyuan VR Tech, noted that these regions share cultural and consumption similarities with China. Following the impact of the COVID-19 pandemic, Zou’s company has redirected resources to developing economies, reducing its reliance on the U.S. market to less than 10%. Currently, half of the company’s orders originate from countries outside China, with India emerging as a significant export market. — new from AP News
