Where China’s Exports Begin - Inside the Vast Markets of Guangzhou

New York Times. February 14, 2025.

Rows of white concrete buildings near the Pearl River in southern China house one of the world’s fastest-growing industries: Gritty workshops are churning out inexpensive clothing that is exported straight to homes and small businesses around the world. No tariffs are paid, and no customs inspections are conducted.

The laborers who make these goods earn as little as $5 an hour, including overtime, for workdays that can last 10 hours or more. They pay $130 a month to sleep on bunk beds in tiny rooms above factories packed with sewing machines and mounds of cloth.

“It’s hard work,” said Wu Hua, who sews pants, seven days a week, at a factory in Guangzhou, a vast metropolis that straddles the Pearl River.

E-commerce giants have forged close links from international markets to workers like Mr. Wu, shaking retailing and economies around the globe.

The number of duty-free shipments to the United States has risen more than tenfold since 2016, to four million parcels per day last year. Similar shipments to the European Union have climbed even faster, reaching 12 million parcels a day last year. Duty-free shipments to developing countries like Thailand and South Africa have also surged.

Now a global backlash is underway. President Trump ordered a halt on Feb. 4 to the duty-free entry, without inspection, of parcels with goods worth up to $800. Mr. Trump temporarily suspended his order to give officials time to devise a plan for dealing with the mounds of parcels that immediately started piling up at airports for inspection.

Since taking office less than a month ago, Mr. Trump has launched a fusillade of trade actions, including an order on Thursday for his advisers to come up with new tariff levels that take into account a range of trade barriers. But a lasting halt on duty-free shipments could be one of the most far-reaching move. These shipments have skirted until now not only his new tariffs, including a 10 percent tax on all goods from China, but also many other tariffs that have accumulated over the years.

The U.S. action on so-called de minimis shipments — low-value parcels that customs services don’t bother inspecting or calculating tariffs on — was one of many. Last summer, South Africa imposed 45 percent tariffs on even the smallest imports of clothing. Thailand ended its exemption of low-value imported parcels from sales taxes, although it continues to allow tariff-free entry of parcels up to 1,500 Thai baht ($44). And the European Commission, the executive arm of the European Union, proposed this month to end the 27-nation bloc’s duty-free treatment of packages worth up to 150 euros ($156).

Countries have cited different reasons for their restrictions. Mr. Trump contended that by skirting customs inspections, the duty-free parcels had become a conduit for fentanyl and related materials to enter the United States. The European Commission cited a need to ensure product safety in imports, stop counterfeit goods and prevent unfair competition. South Africa and Thailand acted to protect local shop owners.

“We have a duty to ensure that goods entering our market are safe and that all traders respect consumers’ rights,” said Michael McGrath, a European commissioner.

This corner of southern China near Hong Kong has been a hub of low-cost manufacturing for export since the 1980s, especially apparel. But the rise of e-commerce sellers around the world has created ever-growing demand of such shipments.

Guangzhou has emerged as the global hub of de minimis shipments. Across many square miles of the city, fast fashion garments are made in concrete buildings with sewing shops, and sometimes living quarters above them.

Shein and Temu, competing Chinese e-commerce giants that together hold at least a third of the de minimis industry, coordinate much of their supply chains from large offices in Guangzhou.

Episode 4118 - Feb 14 - Tiếng Anh - Xuất khẩu của Trung Quốc bắt đầu từ đâu - Vina Technology at AI time

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Episode 4118 - Feb 14 - Tiếng Anh - Xuất khẩu của Trung Quốc bắt đầu từ đâu - Vina Technology at AI time