The trade war of Trump with China could disable smart ideas and companies




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US President Donald Trump, center, will speak on Thursday, August 16, 2018, during a meeting in the White House cabinet room in Washington, DC, USA. Trump praised China for offering more to the negotiating table when the two countries prepared for their first major negotiation in more than two months in an attempt to enter into an all-encompassing trade war. Photographer: Oliver Contreras / Pool via Bloomberg

An ever-evolving trade war between the United States and China has led hundreds of American companies to Washington, DC to try to make peace. At the moment, rates are focused on industrial goods, but Donald Trump wants to raise the total stake to $ 200 billion – a step that would affect consumer goods and smart products such as thermostats, LED lights and electric bikes.

A total of 400 companies testified this week for the American trade representative. And those companies try to prevent the products they make in China from being subject to a 25% rate before they enter the United States. China is a central source for almost all consumer products, including products for smart homes, smart businesses and smart cities – devices that not only grow in demand but also have harmful effects on the environment.

That said, rising labor costs have led some companies to consider switching to other Southeast Asian countries. At the same time China devaluates its currency, making its goods cheaper while the price of foreign products is rising, especially from the United States where the dollar is relatively strong.

"If you are Trump, you have to worry: if his motive is to increase tariff revenues or to control China, he will actually have less power over it if companies move outside China," says Nathan Resnick, chief executive of San Diego. -based Sourcify, in an interview with this writer. "In the end, trade must be completely free and trade must be global, and tariffs harm both the Chinese and the US economy."

Resnick, who oversees a b-to-b production platform, says that labor prices in China are rising and that companies are already expanding to other Asian countries such as Thailand, the Philippines and Vietnam. Adding a 25% rate on top of the increased overhead could move some of the more flexible companies it works with. & Nbsp;

The Trump government has complained that China steals the intellectual property of this country and at the same time creates barriers that are hard to break for American manufacturers. By threatening the tariffs on all goods from China, the president thinks he will solve the problem – and that this country could win a total trade war.

China is turning back

But that is not how China thinks it has levied its own rates trying to hit the American interior. For example, it concerns the agricultural and energy sectors, which will make it more expensive for American developers of energy to send liquefied natural gas (LNG) to China – now the third largest LNG importer in this country. In everything, China represents 6% of the American energy trade.

Meanwhile, American companies are generally opposed to higher rates. Time and time again, executives told the US sales representative that the imposition of tariffs on imported Chinese goods would lead to them becoming less competitive or would force them to raise their prices. Ancheer, an e-bike company based in California, told Electrekthat it would eat part of the tariff, but would pass parts of it to buyers.

"As part of ongoing trade negotiations between the US and China, a 25% rate will be imposed on electric bikes," adds Radio bikes. "Although we have found ways to absorb much of the impact of the 25% rate, we are still forced to raise the prices of our US ebike models by $ 200."

12 July 2018, Germany, Gescher: Minister for the Environment of the Social Democratic Party (SPD), Svenja Schulze (2L), cycling with an e-bike after a visit to Hof Wessels Lern- und Erlebnisort & # 39; (lit. Hof Wessel & # 39; s Learning and Adventure site) with journalists. Photo: Ina Fassbender / dpa (Photo by Ina Fassbender / photo alliance via Getty Images)

Green cities generally feel the impact of rates. E-bikes mean less congestion and fewer exhaust emissions. But higher prices for low-energy incandescent light bulbs, smart meters and smart thermostats such as those made by NEST could delay the so-called Internet of Things (IoT), which stores all data in a cloud, making it easily accessible from multiple points.

Energy and environmental professionals, for for example, it could use that information to reduce harmful emissions in their activities. Take sensors that are the core of the IoT and that are used to know if someone is in a room, so the lights can turn on or off: since that technology is ubiquitous, the costs are reduced over time. decreased by about 80% – a trend that could turn itself back with rates.

Companies that develop components for smart technologies such as Cisco, Google and Microsoft will be affected, as well as companies that sell end products such as WalMart and Target.

Some companies with high fixed costs can not only pick up and move their factories from China and to another country in Southeast Asia. It takes time and money to do this. For others, however, they think in the longer term and they have more flexible operations.

Smooth operators

Consider Hong Kong-based Freitos, an expedition market that supports hundreds of companies in shipping products around the world: it helps to move consumer goods from China to the United States, but also to the United Kingdom and China. Marketing executive Etan Efrati told this writer that his shippers have neither the loyalty nor the strategic ties with China. If the costs rise there, they have the ability to move.

"If the tariffs are going to use consumer products, which they do not currently do, these companies will switch to Southeast Asia," he says. "The tariffs would increase demand in places such as Vietnam and the Philippines, with only a few customers with deep-rooted supply chains affected."

Most companies prefer that the Trump administration try to resolve its trade dispute with China in a peaceful way – not to turn the matter into an international economic conflict. American energy developers who export their product to China would be hit by a tariff, while those American makers of smart consumer products would get one if their thermostats, meters and e-bikes enter this country.

Without an amicable settlement, companies will have to reconsider their business strategies and purchasing centers – a step that would affect global supply chains and the costs of doing business. The fallout would extend beyond the economic and environmental spectrum and cause more damage than the President had ever thought. & Nbsp;

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US President Donald Trump, center, will speak on Thursday, August 16, 2018, during a meeting in the White House cabinet room in Washington, DC, USA. Trump praised China for offering more to the negotiating table when the two countries prepared for their first major negotiation in more than two months in an attempt to enter into an all-encompassing trade war. Photographer: Oliver Contreras / Pool via Bloomberg

An ever-evolving trade war between the United States and China has led hundreds of American companies to Washington, DC to try to make peace. At the moment, rates are focused on industrial goods, but Donald Trump wants to raise the total stake to $ 200 billion – a step that would affect consumer goods and smart products such as thermostats, LED lights and electric bikes.

A total of 400 companies testified this week for the American trade representative. And those companies try to prevent the products they make in China from being subject to a 25% rate before they enter the United States. China is a central source for almost all consumer products, including products for smart homes, smart businesses and smart cities – devices that not only grow in demand but also have harmful effects on the environment.

That said, rising labor costs have led some companies to consider switching to other Southeast Asian countries. At the same time China devaluates its currency, making its goods cheaper while the price of foreign products is rising, especially from the United States where the dollar is relatively strong.

"If you are Trump, you have to worry: if his motive is to increase tariff revenues or to control China, he will actually have less power over it if companies move outside China," says Nathan Resnick, chief executive of San Diego. based on Sourcify, in an interview with this writer. "In the end, trade must be completely free and trade must be global, and tariffs harm both the Chinese and the US economy."

Resnick, who oversees a b-to-b production platform, says that labor prices in China are rising and that companies are already expanding to other Asian countries such as Thailand, the Philippines and Vietnam. Adding a 25% rate on top of the increased overhead could move some of the more flexible companies it works with.

The Trump government has complained that China steals the intellectual property of this country and at the same time creates barriers that are hard to break for American manufacturers. By threatening the tariffs on all goods from China, the president thinks he will solve the problem – and that this country could win a total trade war.

China is turning back

But that is not how China thinks it has levied its own rates trying to hit the American interior. For example, it is looking for the agricultural and energy sectors, which will make it more expensive for American energy developers to send liquefied natural gas (LNG) to China – now the third largest LNG importer in the country. In total, China represents 6% of the US energy trade.

Meanwhile, American companies are generally opposed to higher rates. Time and time again, executives told the US sales representative that the imposition of tariffs on imported Chinese goods would lead to them becoming less competitive or would force them to raise their prices. Ancheer, an e-bike company based in California, told Electrek that it would eat part of the tariff, but would pass on parts of it to buyers.

"As part of the ongoing trade negotiations between the US and China, a rate of 25% is imposed on electric bicycles," adds Rad Power Bikes. "Although we have found ways to absorb much of the impact of the 25% rate, we are still forced to raise the prices of our US ebike models by $ 200."

12 July 2018, Germany, Gescher: Minister for the Environment of the Social Democratic Party (SPD), Svenja Schulze (2L), cycling with an e-bike after a visit to Hof Wessels Lern- und Erlebnisort & # 39; (lit. Hof Wessel & # 39; s Learning and Adventure site) with journalists. Photo: Ina Fassbender / dpa (Photo by Ina Fassbender / photo alliance via Getty Images)

Green cities generally feel the impact of rates. E-bikes mean less congestion and fewer exhaust emissions. But higher prices for low-energy incandescent light bulbs, smart meters and smart thermostats such as those made by NEST could delay the so-called Internet of Things (IoT), which stores all data in a cloud, making it easily accessible from multiple points.

Energy and environmental professionals, for for example, it could use that information to reduce harmful emissions in their activities. Take sensors that are the core of the IoT and that are used to know if someone is in a room, so the lights can turn on or off: since that technology is ubiquitous, the costs are reduced over time. decreased by about 80% – a trend that could turn itself back with rates.

Companies that develop components for smart technologies such as Cisco, Google and Microsoft will be affected, as well as companies that sell end products such as WalMart and Target.

Some companies with high fixed costs can not only pick up and move their factories from China and to another country in Southeast Asia. It takes time and money to do this. For others, however, they think in the longer term and they have more flexible operations.

Smooth operators

Consider the Hong Kong-based Freitos, an expedition market that supports hundreds of companies in shipping products around the world: it helps move consumer goods from China to the United States, but also to the UK and China. Marketing executive Etan Efrati told this writer that his shippers have neither the loyalty nor the strategic ties with China. If the costs rise there, they have the ability to move.

"If the tariffs are going to use consumer products, which they do not currently do, these companies will switch to Southeast Asia," he says. "The tariffs would increase demand in places such as Vietnam and the Philippines, with only a few customers with deep-rooted supply chains affected."

Most companies prefer that the Trump administration try to resolve its trade dispute with China in a peaceful way – not to turn the matter into an international economic conflict. American energy developers who export their product to China would be hit by a tariff, while those American makers of smart consumer products would get one if their thermostats, meters and e-bikes enter this country.

Without an amicable settlement, companies will have to reconsider their business strategies and purchasing centers – a step that would affect global supply chains and the costs of doing business. The fallout would extend beyond the economic and environmental spectrum and cause more damage than the President had ever thought.


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