To be fair, the diversification of production bases has given Chinese exporters more strategic flexibility. And forgive me if there is any survivorship bias here—OCBC’s client base naturally leans towards the more resilient players.
I wrapped up my final business trip of the year last week, and as usual, it came with the “China macro field-trip package”: conversations with regulators, corporates, and institutional clients. Sentiment remained mixed, though the obsession with Trump’s tariffs seems to be fading slightly. Many now take comfort in Trump’s famed “flexibility”—a view reinforced by the recent TACO performance. What can I say? Chinese clients continue to be impressively resilient.
Across sectors—commodities, manufacturing, pharma—most firms have already adapted to the tariff landscape. Some even benefitted from shifting production into ASEAN, though they were not shy about complaining about inefficiencies there, such as export tax rebate. Interestingly, thanks to the latest trade truce, tariff-adjusted costs for certain products have once again become cheaper in China than in Asean. So importing directly from China suddenly makes economic sense again.
