While US President Trump and Chinese President Xi agreed to a “truce” in their year-long trade war at the recent G20 Summit, the war is far from over. In this post, we will look at the impact on the U.S. global trade management, retail sourcing and the global supply chain, our next post will focus on the impact and implications of the trade war on China trade management, retail product development and CPG exports.
On the plus side, the US and China avoided further tariffs threatened by Trump on an additional US$ 300 billion worth of goods. As both sides get some breathing room to plan their next move, what is becoming clearer is what many pundits have threatened, that protectionism does not work in the long term.
Impact of the Trade War on the US
In the initial stages of the trade war, it seemed there was negligible impact to the United States. The USD dollar remained strong, stock markets continued to perform well, and consumer retail spending remained buoyant. In recent months some of these dynamics have changed. Some highlights:
Following the G20 Summit where the US and China agreed to a “tariff ceasefire”, China’s Ministry of Trade spokesperson, Gao Feng noted correctly that there are still many issues to be resolved to end the conflict. So far, aside from China and the US, a few other countries such as Vietnam and Brazil have benefitted from the trade war by picking up orders that have been diverted from the US and China.
In our next post we will look at the impact of the trade war to this point on China and how the rest of the world’s largest retailers are handling their global trade management.
All these issues and more are covered in the most recent CBX Q2 2019 Sourcing Report. To learn more about how to address some of these issues with the CBX platform, feel free to contact us directly
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