Another company is about to be caught up in the China trade war. The Chinese government announced it would look that the freight company’s actions under the “suspicion of undermining the legitimate rights and interests of Chinese clients.” It is not entirely clear what that means.
Part of the official announcement by the government is that FedEx did not deliver packages to some key Chinese companies. These were neither named by an individual firm or industry. It may well be that the decision is a simple retaliation for actions taken by the U.S. government against telecom giant Huawei. Huawei has recently accused FedEx of failures to deliver packages from its suppliers, presumably because of the U.S. government ban on the use of its technology in the U.S. The American government has tried to get other nations to follow suit, which would further damage the Chinese company.
The trade war has ratcheted up to a level which includes U.S. tariffs on at least $200 billion in goods, China’s decision to cease the buying of U.S. soybeans, China’s treat to block the export of rare earth metals which are essential in much U.S. built technology and military products.
The fight may quickly damage both stock markets and the overall economy according to many experts, the OEDC, and the IMF.
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