New U.S. tariffs big threat to Taiwan businesses in China: experts | Economics | FOCUS TAIWAN - CNA ENGLISH NEWS
focustaiwan.tw

Taipei, Sept. 24 (CNA) Taiwanese businesses operating in China will be badly hurt by the trade skirmish between the United States and China next year when their orders are likely to gradually shift to other countries, experts said Monday.

The U.S. government recently imposed a new 10 percent tariff on US$200 billion worth of Chinese imports, spanning thousands of products that include food seasonings, baseball gloves, network routers and industrial machinery parts.

The 10 percent tariff on those goods will be increased to 25 percent effective Jan. 1, 2019.

Chen Tain-jy (陳添枝), an economics professor at National Taiwan University, said the decision for a two-phase increase was made to reduce the toll of higher tariffs on holiday shoppers buying Chinese imports in the coming months.

China-based Taiwan manufacturers will begin to feel the pinch beginning next year, because American importers will be looking elsewhere for their products to avoid the added costs, Chen told CNA.

He suggested Taiwanese firms based in China whose main export market is the U.S. start thinking about relocating back to Taiwan or setting up factories in other countries to avoid the increased operating costs brought by the tariffs.

Liu Meng-chun (劉孟俊), head of the First Research Division at the Taipei-based Chung-Hua Institution for Economic Research (CIEA), said Taiwanese companies whose main customer base is in China will also be hit by the new tariff measure.

The Chinese government has already devalued its currency by nearly 10 percent to support its exporters amid trade tensions with the U.S., but it isn't likely to let the yuan weaken much further due to the risk of inflation, Liu said.

He said Taiwan will not escape unscathed from the trade skirmish because of its close trade relations with China.

(By Chu Che-wei and Ko Lin)

Enditem/ls

7 months conditional neutral

Currency converter

Exchange rates

2000 CZK to SEK
Helsinki, Republic of Finland.
100 EUR to MYR
Kuala Lumpur, Malaysia.
10 JPY to EUR
Yokohama, Japan.
20 ILS to CZK
Tel Aviv, State of Israel.
18 INR to SAR
Dammam, Kingdom of Saudi Arabia.
100 EUR to DZD
Taichung, Taiwan.
10000 INR to GBP
London, United Kingdom of Great Britain and Northern Ireland.
1 EUR to NOK
Vienna, Republic of Austria.
1500 CNY to HKD
Kazan, Russian Federation.
100 CAD to TWD
Stouffville, Canada.
100 SAR to INR
Jeddah, Kingdom of Saudi Arabia.
100 OMR to USD
Kampala, Republic of Uganda.
100 SAR to INR
Jeddah, Kingdom of Saudi Arabia.
100 USD to COP
Miami, United States.
20 XOF to NGN
Almere Stad, Kingdom of the Netherlands.
30 MOP to MNT
Ulan Bator, Mongolia.