US-China trade war could make Middle East a dumping ground for cheap imports: Report

An escalating trade war between the US and China could flood the Middle East with cheap goods from China, according to a new analysis by Bloomberg.

Trump has already imposed 20 percent tariffs across the board on all Chinese goods entering the US, in addition to other tariffs on Mexico, Canada, and the EU, including steel and aluminium. On Wednesday, he wrote on social media that 2 April will be “Liberation Day in America”, as he gears up to unveil more tariffs.

The result of those tariffs is that Chinese manufacturers will look for other markets to sell their goods to, including the developing world and the so-called global south.

Trump’s complaint that China’s cheap, subsidised manufacturing sector has ravished American middle-class jobs could soon be replicated in other countries like Turkey and Saudi Arabia, trying to develop their manufacturing industries.

According to Bloomberg, Turkey, which is trying to position itself as a manufacturing hub for Europe, could face a deluge of cheaper Chinese imports. During his first term in office, Trump slapped tariffs on China, which the Biden administration largely retained. From 2017 to 2023, the value of Chinese exports to Turkey surged from $23.8bn to $45.1bn, according to Bloomberg.

Saudi Arabia, which is trying to utilise its cheap energy prices to position itself as a manufacturing hub, also saw a surge in Chinese imports, which massively favoured China. Between 2017 and 2023, Chinese imports to the oil-rich Gulf state surged 9.6 percent compared to just 4.3 percent of imports from the rest of the world.

While Saudi Arabia might be able to absorb a new flood of Chinese products, poorer Arab states may not. Morocco has positioned itself as a hub for manufacturing vehicles sold in Europe. The most vulnerable country could be Egypt, whose manufacturers are already reeling from a currency crisis.

Saudi Arabia, the UAE, and Turkey have all witnessed a surge in Chinese machinery and electrical and electronic imports. The two Gulf states have also seen vehicle imports from China soar.

Saudi Arabians have become buyers of Chinese electric vehicles (EVs), and the government has signed a $5.6bn deal with Chinese car maker Human Horizons to partner in production.

The trade war between the US and China means Saudi Arabia will be watching carefully to see the breakdown of EVs manufactured in the kingdom versus those imported from China. Saudi Arabia has partnered with American luxury EV maker Lucid to manufacture 300,000 cars per year for export, including to China.

Turkey has made the deepest strides in manufacturing, but a currency crisis has made it difficult for Turkey to import expensive component parts and raw materials.

If the Middle East is flooded with a wave of cheaper Chinese goods, they may have to take a page out of Trump’s protectionist playbook to protect their nascent markets.

China’s more exposed neighbours have already done so, according to Bloomberg. Malaysia added a 10 percent sales tax on online purchases of low-value goods in 2024. Vietnam has banned Temu, China’s cheaper answer to Amazon.

India, which is trying to position itself as a high-tech manufacturing alternative to China, has opened probes into China dumping (exporting products cheap enough to undercut the domestic market) solar cells, aluminium foil, and mobile phone components.