US-China trade war: How does it affect the Kosovo market?

Chinese products are part of everyday life in Kosovo, but the trade conflict between two world powers, the US and China, could also bring changes for Kosovar consumers. While economic experts believe that this trade war could bring inflation in Kosovo, a Kosovar businessman says that this situation could reduce the prices of Chinese products. 

Smartphones, computers, tools, clothing. Many of these products that we use every day in Kosovo originate from China. This gives China an important role in the Kosovo market.

But the global situation is changing rapidly. The United States has launched a trade war against China.

Initially, the US imposed a 34 percent tariff on Chinese products, but that was just the beginning. China responded by imposing 84 percent tariffs on a range of American products.

Following this on Wednesday evening, US President Donald Trump announced that tariffs would immediately increase to 125 percent on Chinese goods.

An action that further escalates the clash between the two largest economies in the world.

On April 11, China retaliated against the US with a similar 125 percent tariff on American products.

But what does this have to do with Kosovo more than one might think?

Kosovo imports more than 12 percent of its goods from China, a figure that ranks it third in terms of import volume after Germany and Turkey.

Last year, imports from China amounted to over 748 million euros.

Some economists expect the new tariffs to also affect Kosovo.

Not ruling out increased inflation, but a completely different perspective, expressed businessman Ramiz Kelmendi.

"The increase in United States tariffs on China will lower China's prices. Competition will increase because the American market has been suitable for China. You know that even mobile phones are produced in China," Kelmendi declared.

Kelmendi claims that his company imports around 12 million euros worth of goods from China every year and has no intention of stopping this practice.

He would prefer to import these goods from European countries or the US, but he says importing from China is more profitable.

Unlike imports, Kosovo exports little to China.

Last year, Kosovo exported goods worth around 420 thousand euros to China.

And that's where mineral materials, chrome, and dresses come in.

Despite the fact that China does not recognize Kosovo's independence and has no diplomatic relations with it, trade between the two countries has developed without obstacles.

Kosovo, as a small but open market, is sensitive to global developments.

With tariffs increasing to 125 percent, Kosovo could face higher prices but also new opportunities to expand trade with other countries. /Radio Free Europe/