Trump, China tariff, trade fight causes disruptions for US companies

The trade battle between President Donald Trump and China is set to formally kick off Friday, when the US is set to impose tariffs. And it appears some US companies are already dealing with the fallout.

The Washington Post’s Danielle Paquette reported that some of the “qualitative measures” China promised in response to Trump’s tariff threats may already be in effect.

US companies shipping goods to China are facing an increased number of inspections and delays in the country, according to the Post. One company said random border inspections increased by 98% over the past month, and an agriculture company said a shipment of cherries spoiled and had to be returned after Chinese officials forced the goods into quarantine.

While those particular instances may not be directly related to the tariffs, groups in China, such as the US Chamber of Commerce in China, told the Post that members are concerned about the possibility of regulatory retribution on US firms due to Trump’s trade fight.

David Lubin, chief emerging market economist at Citi, wrote following a recent trip to China that options for retaliation being discussed in the country included “a go-slow by China on license approvals for US firms” and “enhanced product inspections.”

There have also been concrete examples of the trade fight’s fallout. For instance, China canceled orders for 1.1 million tons of US soybeans. Soybeans are the US’s largest agricultural export to China, with $14.2 billion worth of the crop going to China in 2016.

Looming over the disruption is the impending imposition of the first wave of tit-for-tat tariffs that will go into effect Friday. The US and China are set to hit roughly $34 billion worth of goods from the other country with new tariffs starting on Friday, which will be the biggest blow so far in the growing trade war.

The snags also come as US companies face trade-related troubles at home. Firms are considering layoffs and shifting operations outside of the US in order to handle the impact of Trump’s various tariffs.

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