[Source/Observer Network Wang Yi] After US President Donald Trump initiated the tariff war against China, Yiwu, the world's largest commodity distribution center, became the focus of global media attention. Reporters from various countries flocked to this small city in an attempt to see scenes of despair.

But reality disappointed them.

On May 1st, the British Broadcasting Corporation (BBC) reported that what they saw in Yiwu were buyers from Africa and South America, sellers actively learning foreign languages to develop markets outside the US, and merchants showing disdain for Trump with eye-rolling expressions.

"We don't care about sales to the US; there are other countries with money!" said Hu Tianqiang, a toy merchant in Yiwu, sitting among a dazzling array of toy airplanes, barking toy dogs, Barbie dolls, Spider-Man riding motorcycles, and more. Previously, he had around 20% to 30% of his business coming from the US, but now things have changed. "We currently mainly sell to South America and the Middle East. We're not short on money; we're very rich," he told the BBC.

When asked about Trump, Chen Lang, Hu Tianqiang's colleague, interrupted with an eye roll and said, "The international jokes he's making are incredible, one after another. For him, imposing tariffs is just a joke."

Yiwu Toy Wholesale Market BBC

Hu Tianqiang's toy stall is located in Yiwu's largest wholesale market, which houses over 75,000 shops, offering everything from twinkling Christmas lights, kitchenware, umbrellas, to massage guns. One can find anything they want here.

This is just the tip of the iceberg for Yiwu's commodity market. The BBC pointed out that last year, Yiwu's exports to the US accounted for 17% of China's total exports to the US, making Yiwu and its surrounding areas now at the forefront of the Sino-US trade confrontation.

Trump imposed three-digit tariffs on all Chinese goods exported to the US, almost halting trade between the two countries. But facing US economic bullying, China has never backed down. The BBC noted that many Chinese merchants and exporters, like Hu Tianqiang, in factories and markets alike, have not given in. They say they have other choices besides the US under Trump's leadership.

In the market where Hu Tianqiang's toy stall is located, the BBC met many buyers from the Middle East, Africa, and South America. It is known that thousands of buyers from around the world flood into the market every day. They communicate with Chinese merchants in various languages. Sometimes, if inconvenient, buyers directly input numbers into calculators and write the final price on the floor with chalk.

Yiwu traders dress up and study Arabic. BBC

A stall owner from Iran who was teaching the students explained that these students are the backbone of China's foreign trade, studying these courses to stay ahead and competitive.

The BBC noted that most traders already speak a few words of English, and now they want to learn Spanish and Arabic to welcome more new buyers – a subtle but crucial sign of China's shifting trade relations.

Oscar, from Colombia, walked around the market with a bag full of furry rabbits and bear toys. He said that the trade war initiated by the US provided many opportunities for traders in other parts of the world. People now feel that "doing business with China is very important, while doing business with the US is not as significant."

Aside from exploring new overseas markets, China's domestic market is also the confidence boost for Chinese merchants dealing with the US trade war. Nie Ziqin, one of Yiwu Trade City's "most outstanding boss ladies," originally had half of her orders coming from the US, which would be affected by US tariffs. However, Nie Ziqin previously told Caixin that she was shifting some of her orders to the EU market, with the next focus being on a series of New Year products for the domestic market. She believes that through expanding the EU market and shifting to domestic sales, she can do well too.

In stark contrast to Chinese sellers actively expanding new markets, American buyers are having a tougher time.

Lin Xiupeng, a toy merchant in Yiwu, told the BBC that he had been in the toy industry for ten years and noticed a decrease in American buyers. But he confidently said, "They definitely need China." Most of the US toys are supplied by China, and many US companies have recently protested the tariffs.

Trump toys for sale at the Yiwu toy wholesale market BBC

His feeling was correct. On April 30th, Bloomberg reported that Trump's tariff policies further exacerbated the困境 of the already struggling US toy industry, which experienced a surge in sales during the pandemic and is now slowing down. Last week, the American Toy Association, representing 850 toy manufacturers, filed a lawsuit accusing Trump's government of "unconstitutional" tariff policies.

It was reported that approximately 96% of US toy and game companies are small and medium-sized enterprises. Given the quality and affordability of Chinese manufacturing, these companies cannot easily change their supply chains.

"Tariffs have dealt a heavy blow to small businesses across the US," Jonathan Cathey, owner of a toy company in Los Angeles, complained to the BBC. "The entire toy industry could be in trouble. We are witnessing the complete collapse of the supply chain, and things will get very bad."

Cathey pointed out that producing a toy requires extensive resources, and many Chinese companies have spent 40 years perfecting their manufacturing processes. Changing suppliers is a daunting task.

And the cost of this daunting task will ultimately be borne by consumers. Chris Cocks, CEO of Hasbro, said during a conference call on the company's earnings report on April 24th that about half of the toys and games sold by their company in the US are made in China. If they switch to Turkish suppliers, there will be additional costs, and they will have to increase product prices.

This article is an exclusive contribution by the Observer Network and cannot be reprinted without permission.

Original source: https://www.toutiao.com/article/7499386195592397364/

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