These VA Industries Hit Hardest In Tit-For-Tat U.S.-China Trade War

VIRGINIA — President Donald Trump’s escalating trade war puts more than $2.3 billion in exports and 16,440 jobs on the line for Virginia businesses and industries, according to the U.S.-China Business Council.

Trump pulled back on some tariffs Wednesday, leaving a 10 percent across-the-board tariff in place but delaying more punitive taxes for 90 days with a lone exception. China increased its duties on U.S. goods to 84 percent in response to the tariffs, and Trump stuck back by raising the duty on imports from China to 125 percent.

The stock market quickly responded to the announcement, with stocks surging to one of their highest gains since World War II.

In 2023, U.S. exports to China amounted to $144.9 billion and supported almost 1 million jobs. The tariffs have divergent effects on states, even within industries. The hardest hit are those that produce soybeans, semiconductors, pharmaceutical preparations and crude oil, the top U.S. exports to China.

According to the U.S. China Business Council, Virginia exported $1.4 billion in goods and $928 million in services to China in 2022 and 2023, respectively. Top goods exported included oilseeds and grains, converted paper products, coal and petroleum products, pharmaceuticals and medicines, and resins and synthetic fibers.

The Virginia Economic Development Partnership's Advisory Committee on International Trade held a meeting this week where members discussed the potential impacts a trade war could have on Virginia.

During the meeting, industry leaders said businesses and consumers are feeling a lot of uncertainty about the impact of tariffs on importing and purchasing goods, according to a WTVR report.

"I think we're still early in the process. I think we still have a ways to go before we really know all the impacts that are going to be out there," committee chair Mike Ligon said.

Meanwhile, Democratic state Rep. Suhas Subramanyam (VA-10) predicted that tariffs will “devastate small local businesses and raise prices on families that are already reeling from high costs.”

“These tariffs will be a self-imposed recession and a blow to the budgets of American families everywhere,” Subramanyam said. “I ask my Republican colleagues to stand with working families and reject the President’s actions.”

Nationally, of the $144.9 billion in exports in 2023, $125 billion was for products grown, produced or manufactured domestically, and the remainder was for foreign goods re-exported to China, according to the U.S.-China Business Council report,

More than 931,000 U.S. jobs are supported by exports to China, outnumbering those supported by the next two Asian markets combined, the report said. Agriculture and livestock exports to China support more U.S. jobs than any other sector by a wide margin.

The report noted that U.S. exports to China dropped by 4.3 percent in 2023 due to stunted economic growth in China, Russia’s war in Ukraine, and strained U.S.-China relationships, as well as long-standing barriers such as tariffs. Soybeans, other oilseeds, and grains fell by $7 billion.

“Challenges in that sector worsen if other producers continue to become more competitive or if these products are targeted in a future tariff spat,” the report said.

Exports of semiconductors have also fallen by several billion dollars, or 52 percent since the peak in 2021. Oregon was among the hardest hit states by the national decline in this category.

The full 2024 report on U.S. exports to China is available online.