Georgia's trade with China stays healthy

From its big manufacturing companies to its small pecan growers, Georgia counts China as a major trading partner.

"In 2017, Georgia's exports to China totaled $2.8 billion. China is currently the third-largest export market for Georgia," said Mary Waters, the deputy commissioner of international trade for the Georgia Department of Economic Development. "China is by far our number one trading partner and we are looking for growing our exports to China as well.

"Georgia is a very strong agriculture state, and actually China is our second-(largest) agriculture export market, so again, very important partnership there. We are a national leader in the export of peanuts; we also grow and export a lot of pecans to China every year," added Waters.

"About 45 percent of our demotic grown pecans are exported to China every year," said Kevin Ivey, president of the US Pecan Growers Council.

According to data provided by US Pecan Growers Council, the total value of US pecan exports to the Chinese mainland grew by 72.9 percent to $24.1 million in 2016. And Georgia is one of the top three states that grow pecans.

"About 90 percent of pecans I grow are exported to China," said Matthew Bailey, a pecan grower in Dougherty and Mitchell counties in Georgia. "The demand of US pecans in China is increasing, and I know lots of local growers are collaborating with China and export their pecans to China.

Bailey said that "with the recent win in China for reduction of tariffs on pecan imports to China, the US pecan industry does not want to see the tariff on pecans in China reversed". He indicated that China's import duty of US pecans had long been set at 24 percent, but since 2015, China agreed to reduce the tariffs twice – now the rate is only 7 percent.

"New tariffs imposed by China will definitely slow our sales and affect local growers negatively – it's a large and growing market for us."

In response to US tariffs on imported steel and aluminum, China responded on March 23 with its own list of American products it would tax.

China's action came on the same day that US President Donald Trump announced that up to $60 billion worth of Chinese imports could face tariffs.

China's list contains 128 products across seven categories, according to the Ministry of Commerce. The list also includes two different tariff levels — 15 percent and 25 percent.

Facing the 15 percent levy are fresh fruits, dried fruits and nut products, wines, modified ethanol, American ginseng and seamless steel pipes. Products exposed to a potential 25 percent levy tax are pork and pork products and recycled aluminum.

Pecans and peanuts currently were not on the list, but almonds, cashews, macadamia nuts and pistachios were, among others.

Georgia's manufacturing industry also plays an important role in its economy and trade, accounting for about $56 billion in production and 385,700 jobs, according to the Center for Manufacturing Research. Automotive and aerospace are the state's major industries.

Many of the companies make products partly from steel or aluminum: Lockheed and Gulfstream build jets. Kia assembles cars. Caterpillar makes tractors. Blue Bird churns out buses.

Manufacturers could see higher costs because of US tariffs on imported steel (25 percent) and aluminum (10 percent).

Waters, the trade official for the state, said that the tariff discussion "is something coming from the federal level, and we are of course following all the details closely. But at the state level, our role is really to help Georgia firms continue to find opportunities in China and to help Chinese companies to find opportunities in the Southeast US through a base in Georgia."