At the heart of China’s small commodities trade, Yiwu remains a bustling node in the global supply chain. Known for its vast wholesale markets and unparalleled logistics efficiency, the city finds itself once again under the international spotlight—not because of a festival or expo, but due to rising geopolitical pressure.
As the U.S. moves to enforce new sweeping tariffs on Chinese goods—reaching up to 145% in April 2025—Yiwu merchants are among the first to feel the ripple effects. Orders from long-time American clients have stalled, some have been outright cancelled, and uncertainty clouds discussions with Western partners.
Yet, as reporter Feng Fan observed in her extensive coverage for the Chinese daily newspaper Global Times, the sentiment across the city is far from panic.
Merchants under pressure, but not defeated
At a tidy hardware store tucked within Yiwu International Trade City, merchant Wu gestures to a display of hand tools. A 10-million-yuan ($1.37 million) order from U.S. buyers is on hold due to tariff concerns. He remains composed. “Honestly, I’m not even worried,” he says.
This particular order amounts to less than 7% of his firm’s annual revenue. Wu, who moved from Beijing to Yiwu after the 2008 Olympics, runs a thriving export business supplying Home Depot, Costco, and other major retail chains.
He’s not alone in his calm response. Yiwu merchants like Wang Nan, who has operated in the city for over two decades, echo his resilience. Despite a U.S. client halting a shipment worth hundreds of thousands of yuan, she remains confident: “We export to every corner of the globe. If Americans stop buying, we’ll simply sell to others.”
Global diversification is the strategy
The keyword is Yiwu merchants, and it defines the current trade strategy—diversification. According to customs data, total trade in 2024 reached 668.93 billion yuan, an 18.2% increase year-on-year. Trade with African nations climbed 16.4%, Latin America 24.4%, and Saudi Arabia 16.5%.
Such growth is not accidental. Yiwu’s traders have long cultivated ties with the broader Belt and Road Initiative (BRI) network. The city’s streets reflect this global reach. Store signs are written in Arabic, Spanish, Portuguese, and Russian. Restaurants serve Ethiopian, Turkish, and Brazilian cuisine. The city’s 1.9 million residents include more than 300,000 foreign nationals, over 21,000 of whom are long-term business residents.
For many, Yiwu offers an efficient gateway to global commerce. “If tariffs slow down our U.S. sales, higher demand from other markets could quickly offset any loss,” Wu notes. The agility of Yiwu merchants lies in their ability to adapt swiftly.
Infrastructure that responds in real time
This adaptability isn’t only human. Yiwu’s infrastructure supports it. The Yiwu International Commodity Trade City comprises 75,000 booths with over 2.1 million types of goods. Shelves overflow with everything from Easter eggs and Santa hats to drones and smartwatches.
Yiwu’s logistics system amplifies this supply-side responsiveness. As merchant Shi Mi of Danmi Tools notes, “The U.S. hopes tariffs will force manufacturers to relocate outside China, but replicating our supply chain is nearly impossible.”
China remains the only country globally that covers all 41 major industrial categories recognized by the UN. Yiwu’s “store in front, factory in back” model is low-cost, efficient, and virtually instantaneous. “If you see a character in a movie that premiered yesterday, you can have that toy produced today—only in Yiwu,” Wu remarks.
A structure that is hard to replace
Yiwu’s ecosystem isn’t easily replaceable. From product development to delivery, everything is integrated. Even with rising shipping costs and tariff-related volatility, international buyers like Brazilian trader Leandro Partata continue sourcing from Yiwu. His recent order: $215,000 worth of festive gifts.
The logic is straightforward. “You can find almost everything in one place,” he says. At another booth, a staff member explains how they offer umbrellas for all budgets—from $1 foldables to $90 parasols lined with Van Gogh artwork and built-in fans.
For Yiwu merchants, speed and customization are not add-ons—they are default features.
Policy support and domestic buffering
Beyond infrastructure, merchants benefit from national and local support. Chinese officials have acknowledged the mounting challenges. On April 9, Xiao Lu of the Ministry of Commerce noted heightened trade risks in 2025. Yet, officials insist that “the sky won’t fall.”
The government is promoting market diversification and enhancing domestic consumption. Tax refunds for foreign tourists, international expos like the 137th Canton Fair and the China International Consumer Products Expo, and cross-border e-commerce incentives aim to maintain export momentum.
Spokesperson Lü Daliang from the General Administration of Customs emphasized that expanding trade with BRI nations now represents 51.1% of China’s total trade—an insurance policy of sorts against Western volatility.
Market realignment underway
Some sectors, however, are feeling sharper pain. A freight forwarder in Yiwu told Global Times that all U.S.-bound shipments in his portfolio have been suspended. Baiyang Group, a Shanghai-listed seafood exporter, halted new U.S. orders entirely. Several textile producers have slowed their production.
Even so, Yiwu merchants—particularly those in diversified sectors like hardware, festive goods, and consumer electronics—appear to absorb the shocks better than others.
Veteran trader Shi Mi is clear: “We’re not afraid of tariffs. The global market is large, and our supply chain can pivot.”
Merchants as signals in a complex system
Yiwu functions as a barometer for global trade tensions. Its traders were among the first to feel the impact of the previous U.S.-China tariff rounds. They were also among the first to adapt. What makes their approach noteworthy isn’t bravado but process. Orders get canceled, but contingency plans are already in motion. New fairs in Kenya, Saudi Arabia, Southeast Asia—each represents an open door.
Their core strength lies in business mechanics: rapid production, deep customer networks, real-time feedback loops, and the ability to move inventory without bureaucratic drag. This resilience isn’t accidental. It’s designed.
A city of global habits and local mastery
Yiwu’s cosmopolitanism reinforces its relevance. Walking through its markets, you hear multiple languages, see cross-border logistics operations in action, and witness contract negotiations over tea.
Its economic model is modular. Traders operate at micro and macro levels simultaneously. Many have endured earlier trade wars and currency crises. As Wu recalls, “When I first arrived in Yiwu, I only had 100 yuan. I built my business here because it’s fast, flexible, and low-cost.”
Now, he sits in his shop—sipping tea, reviewing spreadsheets, and preparing new catalogs. If one order pauses, another emerges. In the machinery of global commerce, Yiwu merchants don’t just survive—they recalibrate.