The US-China tariff war intensified in April, dealing a heavy blow to Chinese foreign trade enterprises. On May 12, China and the US reached a preliminary agreement, instituting a “90-day tariff pause,” prompting jubilation among mainland foreign trade practitioners. Some manufacturers recalled workers who had been on leave, seizing the 90-day window to expedite production.
On May 12, both the US and China issued a joint statement agreeing to significantly reduce tariff levels on each other’s goods. The US temporarily reduced tariffs on Chinese goods from 145% to 30%, while China lowered tariffs on US imports from 125% to 10%. US Treasury Secretary Benson stated during a press conference that the two sides had reached consensus on the “90-day tariff pause.”
Just an hour after the conclusion of the US-China trade talks, many Chinese foreign trade practitioners celebrated in groups, expressing relief at the sudden turnaround. Over the past month, numerous Chinese foreign trade factories had sent workers on early leave, adopting a wait-and-see approach, and now finally witnessed a turning point.
According to a report by Huxiu.com, in a furniture export factory in Dongguan, owner Liu Ming immediately called back workers who had been put on “early leave” last week upon receiving the news. Given the previous sharp drop in orders, it’s crucial to utilize this 90-day period to ramp up production. The factory has urgently shifted to a 24-hour, three-shift production schedule.
The shift in US tariffs offered some respite to cross-border seller Wang Lin. He and his peers quickly reached a consensus: take advantage of the 90-day “tariff holiday” to accelerate shipments to the US and stock goods in local warehouses. Wang Lin remarked, “This is a race against time. Whoever can stock up more goods locally within 90 days, in case of another tariff hike, will gain a competitive edge.”
When US tariffs on Chinese goods reached 145%, a senior industry insider revealed that “90% of traditional foreign trade companies doing business in the US had their orders halted, regardless of whether they were large companies or small and medium enterprises.”
Reflecting on the days since April, many foreign trade bosses were filled with anxiety. Li Qing, a trade company owner in Shenzhen, lamented, “We’ve already lost nearly ten containers in just over a month.”
Floating in the same boat are numerous overseas bosses. Zheng Yonglin, owner of a clothing export company in Guangzhou, shared that following the US tariff escalation, a large portion of his American customers’ goods were stuck in warehouses, order quantities plummeted by half, and with another tariff increase, his company might not survive.
On February 1, US President Trump signed an executive order imposing a 10% tariff on Chinese goods; on March 3, citing the “fentanyl problem,” tariffs were raised to 20%; on April 2, the US initiated reciprocal tariff policies, bringing the total to 54%; on April 8, the US raised the “reciprocal tariffs” from 34% to 84%, resulting in a total tariff of 104%; on April 9-10, the White House announced a further surge in tariffs on China to 145%, a historic high. In addition to imposing tariffs on China up to 145%, the US also revoked the tax exemption policy for small parcels under $800. On May 2, this exemption was officially rescinded, with a 120% tariff imposed on such parcels.
However, the latest news states that the White House website disclosed President Trump’s revised executive order, wherein from 12:01 a.m. on May 14 Eastern Time, the tariff rate for low-value postal items for consumption entering the US or extracted from warehouses will be reduced from 120% to 54%, yet maintaining a volume tariff of 100 US dollars per low-value postal item.
This reduction in tariffs undoubtedly presents a significant boon to export enterprises, but there are widespread doubts in the public arena: How long can this relaxation last? Can the 90-day “tariff holiday” serve as a signal of definitive return to stability?