Trade War Sees 40 Percent of US Firms Relocate Operations Beyond China - Report

According to Reuters, of almost 250 respondents to a survey, which was conducted after China and the United States both raised tariffs on each other's imports earlier this month, almost three-quarters said the higher tariffs were hurting their operations.

Around one-third of companies also said they were increasingly focusing their China operations on producing for the Chinese market rather than for export, while another third said they were delaying and cancelling investment decisions, Reuters reported.

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Moreover, US companies claim they face increased obstacles such as government inspections, slower customs clearance and slower approval for licensing and other applications, according to Reuters.

Since last June, when US President Donald Trump announced 25 per cent tariffs on $50 billion worth of Chinese imports in a bid to balance the trade deficit, the sides have exchanged several rounds of duties. Last week, Washington raised tariffs on another $200 billion worth of Chinese goods to 25 per cent due to the impasse in trade talks. Beijing retaliated by announcing tariff hikes of up to 25 per cent on $60 billion worth of US imports starting in June.

Several rounds of talks between China and the United States on their long-standing trade quarrel have so far yielded no results.

Earlier in May, CEOs of major US corporations warned in a statement that "a return to tariff escalation with China will hurt the US economy and American workers, businesses and farmers".

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