According to an article Hong Kong Economic Times published, if the trade war between U.S. and China were to begin, manufacturers in the Pearl River Delta Economic Zone might be looking at the following options. The first option is to relocate their production line or setup a warehouse in Malaysia, Vietnam, or Thailand, to avoid increases in the tariff. The second option is to forge a fake product bar code or change the country of origin to countries such as Mexico but there will be legal consequences with this approach. The third option is just close the door. The manufactures who make common products such as light bulbs or LED flat panels would face greater risks of closing the door. The last option is to pass the increase to the consumers in the U.S. who will end up paying an extra 30 to 35 percent. Currently, the Pearl River Delta Economic Zone produces 25 percent of the export volume in China. The article stated that companies in the zone will face the largest threat of survival if the U.S. and China trade war were to begin.
Source: Hong Kong Economic Times, April 16, 2018
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