USA-China/Trade Tensions/Impact

Small US company struggles to survive in US-China trade tensions

  • English

Shotlist


Colorado, USA - Recent (CGTN- No access Chinese mainland)
1. Various of products of Zen Magnets
2. Various of staff assembling model of train with Zen Magnets
3. Shihan Qu, founder of Zen Magnets, operating computer
4. SOUNDBITE (English) Shihan Qu, founder of Zen Magnets (starting with shot 3):
"This would be really devastating for us. It's not like there's any alternatives if we could not purchase these magnets from China."
5. Various of Qu, staff, working in office
6. Qu's letter to U.S. Trade Representative
7. SOUNDBITE (English) Shihan Qu, founder of Zen Magnets:
"There's no home grown industry to support here, it's only shooting ourselves in the foot here."
8. Qu walking to desk, picking up magnets
9. SOUNDBITE (English) Shihan Qu, founder of Zen Magnets (ending with shot 10):
"I'm glad and it's a big sigh of relief. I was pretty confident that I was going to be subject to a tariff."
10. Magnets
11. Various of Qu, magnets on desk, packed product
12. SOUNDBITE (English) Shihan Qu, founder of Zen Magnets:
"I thought that was outrageous and dumb and we wouldn't be having these problems if we sold these magnets as ammunition."
13. Various of Qu touching magnet, magnet products on desk

Storyline


While tariffs brought by U.S.-China trade tensions are seriously worrying many U.S. businesses and even have hit some, there are some companies that are lucky to win last-minute reprieves, like Zen Magnets.

Shihan Qu is the founder of Zen Magnets, a Colorado business that makes small magnet balls that provide stress relief, serve as desk toys, and offer users a serious creative outlet.

To manufacture its products, Zen Magnets relies on neodymium permanent rare earth magnet spheres, 97 percent of which Qu said come from Ningbo City, China. Which is why a proposed 10 percent U.S. tariff on rare earth metals had him so worried.

"This would be really devastating for us. It's not like there's any alternatives if we could not purchase these magnets from China," he said.

The tariff, originally part of the package of most recent U.S. tariffs - targeting an additional 200 billion U.S. dollars worth of Chinese goods, so upset Qu that he wrote to the U.S. Trade Representative asking for relief. If the tax remained in place, he said, he would be out of business in a matter of weeks, and forced to lay off all his employees.

"There's no home grown industry to support here, it's only shooting ourselves in the foot here," said Qu.

Fortunately for Qu, 297 categories of products were removed from the U.S. tariff list last month, including rare earth metals.

"I'm glad and it's a big sigh of relief. I was pretty confident that I was going to be subject to a tariff," he said.

This was not Qu's first encounter with the U.S. government. In 2012, the U.S. Consumer Product Safety Commission told Zen Magnets to stop selling these magnets, arguing they posed a safety hazard to children who ingested them.

"I thought that was outrageous and dumb and we wouldn't be having these problems if we sold these magnets as ammunition," said Qu.

At one point, he was forced to burn 400,000 of his products in an industrial oven to destroy their magnetism. Finally this summer, a judge ruled that for now, Qu is free to sell his magnets - and now, that means without the price increase a tariff would have required.

Qu said he has been tired of battling to save his small company. But he is grateful that he has come this far. At least for now, he's one of the survivors of the current trade war.

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  • ID : 8092849
  • Published : 2018-10-11 17:52
  • Last Modified : 2018-10-11 20:44:38
  • Location : Colorado,United States
  • Category : economy, business and finance
  • Duration : 1'04
  • Audio Language : English/Nats
  • Source : China Global Television Network (CGTN)
  • Restrictions : No access Chinese mainland
  • Version : 4
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