Trump tariffs portend bleak prospects for China’s toy exporters at Canton Fair

Unlike the previous two weeks, when foreign buyers eagerly sought out Chinese tech products, the toy exhibition halls saw relatively low foot traffic and a lack of blockbuster products, reflecting the plight of traditional Chinese manufacturers being battered by massive increases in United States tariffs.

Many toy exporters avoided showcasing the latest products developed in collaboration with US clients, due to fears of plagiarism and expectations of low US participation at the fair.

They highlighted the risk of stagnation in research and development on new products if US orders are cut because of the impact of high tariffs.

“The suspension of US orders has negatively affected our R&D,” said Bob Lu of Natty Boy Toys. “Although we will continue R&D, the uncertainty is growing high. If the tariff troubles last for the next couple of years, toy manufacturing exporters will find it hard to bear the R&D costs.”

While shipments to Walmart have recovered, Lu said other American retailers such Target and buyers supplying amusement parks are holding off on new orders, leading to inventory and operational pressures for many Chinese toy manufacturers.

Miya Yu, from Guangdong Ocie Enterprises, said it had brought toy electric motorcycles to the fair that were priced around US$80-$90 with an eye on emerging markets, as they featured “bright colours and dazzling lights suited South American tastes”.

South China Morning Post