The U.S. Firms at Risk From China Trade War: QuickTake Scorecard

 

U.S. companies need to prepare for greater tension between the Trump administration and China. U.S. Commerce Secretary Wilbur Ross opened high-level economic talks on July 19 by scolding China over its trade surplus. That doesn’t necessarily signal a trade war is imminent — the two countries have come through other rocky patches since Donald Trump became U.S. president. Still, Trump is weighing whether to restrict imports of Chinese steel and aluminum, a move that could prompt retaliation from President Xi Jinping. Such tit-for-tat actions could lead to a Chinese backlash against American businesses. The following are among those most at risk:

1. Hollywood

The movie studios want more access to China, where foreign releases accounted for 61 percent of box office sales in the first half of 2017. China allows about three dozen foreign films to be imported on a revenue-sharing basis — with the studio only getting 25 percent. Hollywood wants a higher number of imports and better revenue splits. Negotiations are ongoing and the U.S. could take China to the World Trade Organization if the two sides don’t reach an agreement by the start of 2018.

China’s Xi warns Trump of ‘negative factors’ hurting US ties

President Donald Trump and Chinese President Xi Jinping walk together after their meetings at Mar-a-Lago in Palm Beach, Fla., April, 2017.

 

China’s President lists arms sales to rival Taiwan and US sanctions against a Chinese bank over dealings with North Korea as among the problems.

JULY 3, 2017  BEIJING—Chinese President Xi Jinping warned President Donald Trump on Monday that “some negative factors” are hurting United States-China relations, as tensions flare anew over a slew of long-standing sore points.

Mr. Xi’s comments in a phone call with Mr. Trump follow Beijing’s displeasure over US arms sales to rival Taiwan, US sanctions against a Chinese bank over its dealings with North Korea and, most recently, the sailing of a US destroyer within the territorial seas limit of a Chinese-claimed island in the South China Sea.

White House tells the Pentagon to quit talking about ‘competition’ with China

(Photo Credit: Lintao Zhang/Getty Images)

 

The White House has barred Pentagon leaders from a key talking point when it comes to publicly describing the military challenges posed by China.

In February, Defense Secretary Ash Carter cited the “return to great power of competition” in the Asia-Pacific, “where China is rising.”

Similarly, Chief of Naval Operations Adm. John Richardson characterized China and Russia as rivals in this “great power competition” in his maritime strategy.

Fivefold surge in Americans on Chinese-firm payroll in the US: report

Although the numbers are still quite low, the key issue is not the amount. It likely wouldn’t take more than running 5% of American businesses nation-wide in the most critical industries and businesses to wreak economic havoc if the CCP so wished to pull the trigger — and as the last few years have increasingly shown us, the Chinese leadership’s behavioral patterns and actions indicate wreaking havoc on America is their intention.

 

The number of Americans on Chinese company payrolls has surged more than fivefold over the past five years along with growing foreign direct investment by China in the United States, a study by two US-based organisations has found.

The report – released this month by non-profit group, the National Committee on US-China Relations, and economic think tank Rhodium Group – highlighted the expansion of Chinese firms in various American congressional districts.

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The report, titled “New Neighbours: Chinese Investment in the United States by Congressional District”, showed Chinese firms had invested US$46 billion in new establishments and acquisitions in the US since 2000.