China's Export Challenge: Navigating Domestic Market Complexities Amid Tariffs

Chinese exporters face challenges shifting to the domestic market amid increased U.S. tariffs. With low profit margins and payment issues, many find local sales unviable. Analysts suggest boosting consumer incomes and demand might offset tariff impacts. The government is organizing initiatives to stimulate internal sales but faces hurdles.

Chinese exporters are grappling with the challenges of pivoting to the domestic market, a move prompted by increased U.S. tariffs on Chinese goods. Many, like Eno Qian, a clothing factory owner in eastern China, find domestic sales pose financial risks due to thin profit margins and delayed payments.

The Chinese government is urging exporters to explore internal markets, organizing matchmaking events to bridge manufacturers with retailers. However, these efforts face impediments, including weak consumer demand and high competition. Analysts suggest that without boosting consumer income, increasing domestic supply could exacerbate economic stress.

Economists highlight the necessity of fiscal stimulus to enhance local consumption. Despite effort spearheaded by local governments and companies like JD.com, the transitional shift remains fraught with difficulty, as exporters navigate operational inexperience and low brand recognition. Concrete steps focused on the social safety net are deemed critical for long-term solutions.

(With inputs from agencies.)