The US-China toy trade tariffs are not just an economic issue. They are transforming the way global businesses operate, especially in the toy industry. In Yiwu, China’s massive wholesale market, exporters like Hu Tianqiang have made one thing clear — they are moving on from the United States.
Toy drones buzz through the air above Hu’s stall, where shelves are packed with flashy jets, robots, and plush animals. Just a few years ago, 20–30% of his sales came from US buyers. Now, however, that figure has dropped sharply.
Why Yiwu Matters in the Trade War
Yiwu sits in China’s Zhejiang province, a manufacturing powerhouse on the eastern coast. The city accounted for 17% of China’s exports to the US last year. But things are changing fast. New tariffs of up to 245% on Chinese toys are forcing businesses like Hu’s to rethink their strategy.
In response, many exporters are now focusing on markets in South America and the Middle East. According to Hu, “Other countries have money too.” This shift highlights a broader trend across China’s economy.
American Businesses Are Feeling the Pressure
Meanwhile, US toy companies are feeling the sting. Jonathan Cathey, founder of Loyal Subjects in Los Angeles, says the tariffs could be devastating. He warns, “The entire toy industry could go under.” Like many others, he started small and built his company from scratch. But now, rising costs are threatening everything.
Switching suppliers isn’t easy. Many Chinese manufacturers have spent decades refining their craft. For American businesses, finding alternatives could take years and require significant investment.
Learning New Languages, Finding New Buyers
As the US-China toy trade tariffs bite, Chinese sellers are adapting. In Yiwu, salespeople now take free language classes in Arabic and Spanish. The goal? To better serve buyers from countries like Colombia, the UAE, and Brazil.
One Colombian buyer, Oscar, says the shift is a big opportunity. “Doing business with China is very important,” he explains. “With the US these days, less so.”
These changes are visible in every corner of the market. Exporters are adjusting prices, improving service, and tailoring products to new cultural preferences.
Politics and Propaganda
On the political front, the rhetoric is heating up. Former President Trump has launched another trade war, targeting China and its neighbors. Beijing has pushed back hard. Chinese state media criticize Trump openly, calling him the “worst president in American history.”
While the two governments spar, businesses are caught in the middle. Chinese officials say they won’t back down. At the same time, many American companies are lobbying against the tariffs.
According to Chinese military expert Zhou Bo, Trump is waging a “crusade against the world,” with China as his main target.
The Bigger Picture
For now, US-China toy trade tariffs are creating uncertainty. Yet, they are also opening up new paths. Chinese exporters are becoming less reliant on the US. Meanwhile, US retailers face shortages, especially during peak seasons like Christmas.
In fact, 90% of America’s holiday decorations come from Yiwu. With that in mind, retailers like Walmart and Target have warned of potential price hikes and empty shelves.
Clearly, both countries are affected. However, the long-term impact depends on how businesses respond. For some, this is a crisis. For others, it’s a chance to grow beyond old boundaries.
