Chinese Stuff

In the 24 hours since I wrote about 104% tariffs on Chinese imports to the United States, the rate has gone up to 125%. And although Trump says, “China wants to make a deal”, don’t you believe it; China-made “stuff” is going to be catastrophically expensive (and probably simply unavailable … few people are going to bother importing goods that will have to be priced at over double the current cost) for the foreseeable future.

What “stuff” is that?

Electronics, obviously. Seventy-six percent of smartphones purchased in the U.S. are made in China. And 78% of personal computers and 87% of video game consoles. A week ago, famously non-Chinese company Nintendo announced that it would not take pre-orders for its soon-to-be-launched Switch 2 gaming console, “in order to assess the potential impact of tariffs and evolving market conditions.”

In addition to high-ticket items, Chinese imports account for around 25% of U.S. apparel sales. Twenty-eight percent of Shein’s $32.2 billion worldwide sales in 2023 was recorded in the U.S.

And it’s not just t-shirts and miniskirts. If you’ve bought a pair of sunglasses or an insulated bottle or a toy or a pair of shoes or just about anything made from plastic, chances are it was made in China. And if you want or need to buy any of that stuff this year, it’s going to cost you.

There are some things, of course, that China does not make, mostly because it can’t deliver quality.

So if you’re looking to import commercial aircraft engines, you’ll be unaffected by Trump’s China tariffs.

If you need to buy an MRI machine, you’ll be unaffected by Trump’s China tariffs.

And if you want to buy infant formula, you’ll be unaffected by Trump’s China tariffs.

No one is more aware of the strengths and weaknesses of Chinese manufacturing than Chinese people, and Chinese travelers spend billions every year buying foreign medicines and healthcare products because they deem them safer than domestically produced products.

If you follow news from Asia (or if you clicked on the “infant formula” link above), you will remember the horrifying story of Sanlu Group's sale of melamine-adulterated milk and infant formula, which sickened hundreds of thousands of Chinese infants in 2008, hospitalized tens of thousands, and “officially” killed three.

Years ago I was in Beijing on business, and staying as usual at the Grand Hyatt Hotel. On those trips, if I didn’t have a lunch meeting, I would return to the hotel in between the morning and afternoon sessions to clear emails, and I would typically order something from room service. Most often a simple fried rice or noodle dish (when in Rome!), but one day I decided I felt like a hamburger.

So I picked up the phone.

“Yes, Mr. De Vido, how can I help you?”

“I’d like a hamburger, please, with fries.”

Long pause.

“Sir, I don’t really recommend the hamburger.”

I have spent a lot of time in China and I was astonished. That any Chinese service employee would care at all about my dining experience and/or health.

So I asked, “Why don’t you recommend the hamburger?”

Another long pause.

“Local beef, sir.”

Aha.

Me: “What do you recommend?”

Him: “The shrimp fried rice and the prawn noodles are pretty reliable.”

Me: “I’ll have the shrimp fried rice.”

Him: “Excellent choice, sir.”

And it was. The shrimp were probably from Thailand, of course.