Orange Chinaboy Trump's Swag Made In China

[GAGA 2020/2022]

China’s factories pull in the profits by making Trump merchandise
Business is booming for campaign paraphernalia despite the president’s
fight with Beijing

Chinese factory owners say they earn more money making pro-Trump products
than Chinese flags or Biden campaign merchandise

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Ryan Li does not have a vote in the US presidential election. But if he
did and was voting with his wallet, he would support Donald Trump rather
than his challenger Joe Biden.

Mr Li, a manufacturer at the sprawling Yiwu International Trade Centre, a
wholesale centre in eastern Zhejiang province, has been turning down
orders to make Chinese flags for the week-long National Day holiday.
Instead, he has discovered there is more money to be made manufacturing
merchandise for the US president’s supporters.

“I work for whoever offers the best terms,” said Mr Li, who can charge
Rmb5 (74 cents) per piece of Trump paraphernalia but gets only Rmb4.5 for
each Chinese flag.

Mr Li is one of a number of Chinese merchants profiting from making
everything from hats to wristbands for the US presidential race. Many work
with wholesalers that sell the unofficial goods at Trump rallies, online
or to US retailers.

Given the rapid deterioration in Sino-US relations this year, and Mr
Trump’s targeting of China throughout his presidency, the campaign boom is
probably the most ironic part of China’s export renaissance.

“China’s exports are recovering faster than people think,” said Larry Hu,
an economist at Macquarie Group, the Australian bank. Chinese factories
have in recent months reported a sharp rebound in orders from American
buyers. Exports to the US surged 16 per cent year on year in July and
August, compared with an 11 per cent drop in the first six months of 2020,
according to official data.
A pro-Trump banner produced at a factory in Dongguan, a manufacturing
centre in southern China
A pro-Trump banner produced at a factory in Dongguan, a manufacturing
centre in southern China

Chinese manufacturers are able to offer Trump and Biden supporters low
prices. Yiwu merchants will sell the “Make America Great Again” baseball
caps for as little as 88 cents, generating a generous profit margin for US
retailers that can charge $12 or more for each hat. The manufacturers in
Yiwu make about $2 per hat.

“We cut prices by as much as possible so we won’t lose out to the thousand
other competitors who make the same product,” said Wang Fuli, a hat
merchant in Yiwu. She has generated a third of her sales from the Trump
campaign since April, when the city’s famous market reopened following a
two-month lockdown.

Jimmy Lin’s factory in Dongguan, a manufacturing hub in southern Guangdong
province, has been badly hit by the coronavirus pandemic, with many of his
US clients in arrears. But orders for campaign merchandise, which he began
receiving in February, have helped keep him afloat.

Mr Lin initially estimated that 70 per cent of his US election merchandise
sales, such as a banner emblazoned with the slogan “God, Guns & Trump”,
were for Trump supporters.

“Market demand for Trump products is relatively better,” he said.

But although Mr Lin recognises Mr Trump’s name in English, his grasp of
the language is poor and he had assumed anything he produced with the
president’s name on it was pro-Trump merchandise such as a flag that says
“Anyone but Trump 2020”. Other products say “Impeach Trump: Make America
Great Again” or “Pro America, Anti Trump”.

“I did not know that,” he said when the Financial Times pointed out that
these were anti-Trump products.
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In Guangzhou, Wang Bei’s struggling ZCT Industry luggage factory was about
to go under in May when it switched to making campaign masks. Revenues
have since doubled.

“Masks are much easier than luggage — we just needed to find the right
fabric,” he said.

Initially, he did not have enough workers or sewing machines to meet
soaring demand, but he was able to contract out his orders. “This is an
industrial cluster,” he said. “At peak periods, more than a dozen
factories helped us make masks. The co-operation among factories here is
fantastic . . . We also supported nearby printing factories. Hundreds of
workers were able to keep their jobs.”

ZCT Industry had more Trump orders at first, but Biden masks are making a
comeback. “We sold more Biden than Trump masks over the last two months,”
Mr Wang said.

Why Trump no longer talks about the trade deficit with China

Similar economies of scale are at work in Yiwu. “It makes a difference
paying your supplier one cent less per piece if you have a big enough
order,” said Zhang Guolu, whose factory makes pro-Trump banners.

Xu Hongjie, another Yiwu factory owner who also made Trump banners for the
2016 campaign, said his profits are thinning. He charges Rmb6 per piece,
the same price he received four years ago, even though his production
costs have risen more than 25 per cent during the course of Mr Trump’s
first term in office.

“We don’t have the pricing power,” admits Mr Xu, who makes 20 cents in
profit for every “Keep America Great” banner he sells. “All we can do is
try to control costs.”

Another challenge is the tariffs Mr Trump imposed on Chinese exports
during his 18-month trade war, which were paused in January with a “phase
1” trade deal. Campaign-product exporters still face a punitive 25 per
cent tariff. Merchants in Yiwu canvassed by the FT said they were
generally willing to absorb 5-10 per cent of the extra cost.

The Chinese manufacturers also appreciate that US presidential campaigns
that have proved such a financial boon do not last for ever. “When will
the election end?” asked Mr Wang at ZCT Industry, worried he might be left
with a big backlog of unsold products.

[GAGA 2020/2022]