China’s e-Commerce sector adapts as US tariffs bite

By Transport Intelligence

As the trade war between the US and China intensifies, a raft of measures have been launched to help Chinese exporters further their reach into the domestic market in order to soften the blow on ever increasing tariffs. On April 11, 2025, e-commerce giant JD.com announced a 200bn yuan ($27.35bn) initiative aimed at helping Chinese exporters sell their products domestically over the next year. This plan includes deploying staff to exporters, directly purchasing their quality products, and creating a dedicated section on its platform to promote and sell these goods with enhanced marketing and traffic efforts. Meanwhile, Alibaba’s supermarket chain Freshippo has introduced similar support, offering a streamlined pathway for exporters to access its domestic sales channels, including simplified registration and access to logistics infrastructure

The Chinese government is also currently discussing measures to ease the burden on exporters, such as making rebates on export tax more attractive for domestic companies, as well as potential further steps to stimulate domestic consumption. While some of these responses appear reactive, they also reflect a longer-term strategic shift under China’s dual circulation policy, which aims to cut the country’s dependence on international markets such as the US and was unveiled in 2020.

Publicly, there remains an air of confidence within China’s e-commerce sector – several Chinese businesses from various industries told the Global Times that they are certain they will be able to withstand the tariffs. Yao Zhengzheng, president of Ningbo-based e-commerce company Zhengzheng Electronic Commerce Co, told the Global Times that the company is focusing on expanding its business to emerging markets such as Central and Eastern Europe and Central Asia.

However, in reality there is much doubt around whether China can truly replace the US as a trade partner. For decades, the US has remained China’s dominant export partner. According to Dan Wang from the Eurasia Group consultancy, any tariff upwards of 35% will wipe out all the profits that Chinese businesses make when exporting to the US or South East Asia. Furthermore, although emerging markets may offer volume, they will likely lack the purchasing power of US consumers. From a Western perspective, there is also now a question of whether the EU and China can set aside their differences and forge closer trade ties amid political differences over the Ukraine invasion and concerns with Chinese trade practices.

It is also at present unclear what meaningful steps the Chinese government may take, if any, to encourage domestic consumption. China is already facing mounting pressure from manufacturers looking to diversify their supply chains following the COVID-19 pandemic, and the introduction of new tariffs is expected to further accelerate this process. While a full-scale shift to the US remains unlikely due to cost and infrastructure constraints, many companies are increasingly relocating production to nearby countries like Vietnam and India to mitigate tariff exposure and reduce future trade risk.

Whether domestic efforts and emerging markets can truly offset the loss of US trade therefore remains uncertain. What is clear is that China’s e-commerce sector is evolving rapidly in response, potentially reshaping the online trade landscape in the process.

Source: Ti Insight

Author: Nia Hudson

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