Walmart under pressure in China: demand for discounts because of Trump's customs duties

Walmart under pressure in China: demand for discounts because of Trump's customs duties

Walmart is in the middle of a intensifying trade war between the United States and China. Chinese authorities called on Tuesday executives of the US individual trade giant to investigate whether Walmart has put its suppliers under pressure in China to grant discounts in order to cope with the increasing tariffs imposed by Donald Trump.

rising tariffs and effects on Walmart

Trump has doubled the tariffs to all Chinese imports to 20 % since last week. In response to this, China has announced a new round of retaliatory tariffs that affect US farming imports and have been in force since Monday.

price increases are on

Many retailers are struggling to deal with the chaotic customs announcements from Trump, which tighten the trade tensions between the two largest economies in the world. Retailers to CNN that you may already have to raise the prices, even though many customers are already financial printing and Feel the effects of inflation.

Last week Bloomberg that Walmart asked some of his Chinese suppliers of significant discounts of up to 10 % to compensate for the effects of US tariffs.

reactions of the Chinese authorities

According to a report by Yuyuantantian, the official social media account of the state broadcast CCTV, officials from the Ministry of Commerce have requested a meeting with Walmart to "understand the situation". In the article it said: "If this applies, Walmart's requirement to Chinese suppliers to bear full customs load is inappropriate and disturbs fair competition and the international trade regulations."

possible consequences for Walmart

In a warning, the contribution added that the Chinese authorities could take “further measures” if the American retailer continues to exist on its discounts. Although it is not unusual in China to ask suppliers to finish finances, this is currently a difficult matter, since many already operate with very low profit margins.

Walmart's statement

In an explanation of CNN, Walmart emphasized that it was about helping people "save money and live better". The company continued: "Our discussions with the suppliers aim to realize our goal for millions of customers, and we will continue to work with them to find the best procedure during these uncertain times."

Walmart in China

The retailer, based in Arkansas, not only receives products from China, but also actively and successfully acts on the Chinese market after he started in China in 1996 and opened his first superstore and a Sam’s club in the southern Megastadt Shenzhen. Walmart is present in more than 100 Chinese cities and recorded an increase in net sales in the country in the last financial year at 16 % to $ 17 billion compared to the previous year.