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‘Business is bad’: how the trade war is hurting China’s economic powerhouse province

US tariffs have worsened the economic problems in Guangdong, a region whose revenues are crucial to Beijing

During the heyday of Chinese low-cost manufacturing, the town of Houjie was renowned for both its shoemakers and the raucous nightlife laid on for the thousands of foreign and domestic buyers who visited each year. 

Like other parts of Guangdong, it boomed after China became the world’s export powerhouse and the southern province became a test bed for capitalism and foreign investment as the home of the country’s first special economic zones.

But now, many of its factories are empty, and their surrounding restaurants and businesses are suffering, locals say, as trade tensions unleashed by US President Donald Trump compound the structural decline of low-end manufacturing and weak consumer sentiment.

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