A recent study examines the impact of the U.S.-China trade war on global supply chains, highlighting the importance of innovation and CSR for Chinese suppliers seeking to maintain their U.S. customer base.
The 2018 imposition of U.S. tariffs on over $250 billion worth of Chinese products triggered a significant shift in global supply chains . American buyers, facing increased costs, sought alternative suppliers, leading to a sharp decline in transactions between U.S. buyers and Chinese suppliers. A recent study revealed that this decline exceeded 18% immediately following the trade war 's commencement. However, the impact of the trade war wasn't uniform across all Chinese firms.
The research indicated that companies demonstrating higher levels of innovation and social responsibility were more likely to retain their U.S. customer base. Conversely, buyers appeared to distance themselves from Chinese suppliers with stronger ties to local politics. This suggests that Chinese suppliers seeking to enhance their resilience against future trade tensions should prioritize innovation and corporate social responsibility (CSR). They should also exercise caution when engaging in local political activities. Regulators can support these efforts by fostering an environment that encourages innovation and responsible business practices. Simultaneously, buyers should conduct thorough risk assessments and evaluate their supplier dependencies to mitigate potential disruptions caused by geopolitical events
Trade War Supply Chains Innovation Corporate Social Responsibility (CSR) Global Economy
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