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If China is known as the world factory, then the province of Guangdong is the engine room.
It is here, in the thousands of factories that dominate the suburbs of the city where many of your consumer goods are likely to start their lives, and this is true Donald Trump’s Rates hit first.
China was probably the top goal in the US president’s trade war. Not only was it subject to a series of measures during its first term, but this time it is the only country that had no outbreaks, no delays and rates are levied at 100% of Chinese goods.
A factory worker on the mounting line in a factory for electrical devices in Guangdong
On March 4, anything from China sold to the US has faced a tax of at least 20%, and for many goods it is more than that.
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Johnny pan
Johnny Pan shows us the mounting lane at his factory. This business has been in his family since the 90s and it makes devices such as fans, air purifiers and air roasts.
Lines of workers meet the more complicated components by hand.
A third of its products are currently being sold to America. Rates had an immediate impact; In the past month, they have seen a major decline in orders amounting to millions of dollars.
“We need to look for new markets to get away from the US,” explains Mr. Pan. ‘We need to dive more into product development. But now we have to find out ways to survive. ‘
He wants to actively move from his manufacturing abroad to avoid the rates.
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A factory that makes electrical appliances in Guangdong
But the alleys of this area are distributed with smaller operations with fewer options.
Small workshops often specialize in just one element of a large process, small teeth in a supply chain that they cannot control.
Through one garage door there are three sewing machines blowing; This small operation specializes in the close buttons to garments.
A small factory specializing in adding buttons to garments
The man-and-woman team acknowledges that they are concerned, the income is lower, explains, and it can affect the thousands of contract workers who work at work.
Many here have no option to raise their prices. If the US consumer is not prepared to pay more, the only option is to look for new markets, but if new markets do not offer such willing buyers, jobs and livelihoods are at stake.
This is indeed the main concern of China. A large 20% of its GDP is export, and a trade shock will have a huge impact.
And the economy is already struggling. The growth has delayed dramatically over the past few years, there is very high youth unemployment and very low-paid migrant workers.
The fact that Beijing’s reaction has so far been relatively limited was an awareness that it could not afford a major escalation.
There is some comfort in the fact that China is much less exposed to the US than it once was – the 2016 trade war means it already sends much less goods to America than it once did.
But it is still a system that fears instability above everything and cannot be seen to lose face.
Many people point to the broader context of two global superpowers that both dominate and try in their own ways to guide a shifting world order.
Rates are perhaps just one problem in a larger global stance.
China may still be a powerful economy that can take pain, but the leaders are unlikely to leave things.
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