Walmart has found itself at the center of growing trade tensions between the United States and China after Chinese authorities summoned executives from the retail giant over reports that the company had asked its suppliers in China to lower prices.
The move comes as Walmart seeks ways to offset the impact of US President Donald Trump’s latest tariffs on Chinese imports.
According to China’s state-run media outlet CCTV, the Ministry of Commerce and other relevant departments called in Walmart representatives earlier this week following reports that the retailer had requested price cuts of up to 10% from its Chinese suppliers. The move was reportedly aimed at countering the rising costs of US tariffs.
Chinese officials criticized Walmart’s strategy, accusing the company of attempting to shift the financial burden of the tariffs onto Chinese businesses and consumers. A spokesperson from the ministry stated that authorities had noted the reports and sought clarification from the company.
State media further claimed that, during Trump’s first term, the primary impact of tariffs was borne by American consumers. The new request by Walmart, they argued, was an attempt to make Chinese suppliers absorb those costs instead.
Walmart China issued a statement to state-controlled China Daily, reaffirming its commitment to working closely with suppliers while striving to maintain competitive prices for customers. The company also emphasized the importance of cooperation among all parties to navigate the current trade landscape.
A Bloomberg report earlier this month indicated that Walmart’s request for price reductions had been met with strong resistance from suppliers, particularly those providing kitchenware and clothing. Many of these businesses operate on tight margins, with some warning that reductions exceeding 2% would lead to financial losses.
The backdrop of this dispute is Trump’s recent move to double tariffs on all Chinese imports to 20%, a decision that has escalated trade tensions between the world’s two largest economies. In response, China has introduced retaliatory tariffs targeting US agricultural imports.
Retailers across the US are facing challenges due to the uncertainty surrounding Trump’s tariff policies. Some have warned that they may have to raise prices, adding further strain to consumers already dealing with inflationary pressures.
Despite the challenges, Walmart’s leadership has expressed confidence in the company’s ability to manage the tariffs. CEO Doug McMillon stated in a recent earnings call that Walmart has dealt with tariffs before and will continue to do so. CFO John Rainey echoed this sentiment, saying that while the company had not factored tariffs into its financial forecasts, it was prepared to navigate the situation as it unfolds.
During a press briefing, Chinese Foreign Ministry spokesperson Mao Ning declined to comment on the Walmart meeting but reiterated Beijing’s opposition to additional US tariffs. She emphasized that China has taken necessary countermeasures to protect its interests.
Meanwhile, China’s top textile trade group has urged US retailers to address international trade matters “fairly and reasonably” and announced plans to protect its members’ rights through proactive measures.
Although Walmart sources a significant number of products from China, it also has a strong retail presence in the country. Since entering the market in 1996, the Arkansas-based retailer has expanded to over 100 Chinese cities, operating superstores and Sam’s Club locations. Last year, Walmart’s net sales in China rose 16% to $17 billion.
