Exporters in Europe shift trade to avoid US tariffs

Associated Press


European companies that export from China are changing the global flow of their goods to avoid higher American tariffs, a business group said Tuesday, as the impact of the U.S.-Chinese trade war spreads.

Tariff hikes are “hitting immediately the bottom line” of companies that rely on the free flow of trade across countries, said Mats Harborn, president of the European Union Chamber of Commerce in China.

Companies are “scrambling to readjust supply chains” so U.S.-bound goods don’t pass through China, Harborn said at a news conference. He said one has shifted final assembly of goods to a newly created American unit.

The Trump administration’s tariff hike on medical equipment, electronics and other goods from China apply to exports made by U.S. or European companies as well as Chinese suppliers.

European governments have criticized President Donald Trump’s approach but have resisted Chinese efforts to recruit them as allies in their dispute.

China on Tuesday stepped up action against some U.S. goods by announcing anti-dumping duties on raw materials used in making optical fibers.

Optical fiber preforms from the United States and Japan will face additional duties of 37.9 to 78.2 percent for five years, the Ministry of Commerce announced.

Chinese leaders have emphasized the benefits to foreign companies from trading with the world’s second-largest economy in an effort to deflect pressure to change industrial plans communist leaders see as a route to prosperity and global influence.

On Monday, Chinese and German companies including BASF and Volkswagen signed deals worth $23.6 billion during a visit to Berlin by China’s No. 2 leader, Premier Li Keqiang.

Harborn said a European supplier of environmental technology believed it might have been awarded a Chinese government contract ahead of an American competitor due to its non-U.S. status.

German automaker BMW AG also said it would raise prices on U.S.-built SUVs exported to China due to higher tariffs. BMW exports SUVs from a factory in Spartanburg, S.C.

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