It’s a scene familiar to millions of people in the US and the world wesern world: snow outside, carols playing, and homes adorned with stockings, fairy lights, and a star-topped tree. Yet few realise these festive staples mostly come from a single city in China — Yiwu, often dubbed “Christmas Town.”
Located in China's Zhejiang province, Yiwu, home to the world's largest wholesale market, is the source of around 90% of all Christmas decorations sold in the US. And of the Christmas decoratons of many other western countries.
Much of this trade flows through the city’s vast wholesale market —a sprawling maze of nearly 1,000 acres packed with everything from Santa dolls to artificial trees, and even the MAGA (Make America Great Again) caps.
But, seven months ahead of Christmas, the festive cheer has given way to unease. US tariffs on Chinese goods have soared to 145% under President Donald Trump — the highest in nearly a century. Vendors in Yiwu, many reliant on American customers, are feeling the impact.
“Some of our long-term clients have stopped dealing with us and we are all very sad,” said a trader who has sold Christmas decorations for 15 years. Despite offering discounts, she lost 80% of her American contracts this year — a blow worth over $1,35,000.
Many of these business ties were personal. One American buyer, whom she met at a trade fair and who visited her factory, ended their decade-long partnership due to the tariffs. “We have been working together for a long time,” she said, surrounded by festive plush toys.
Yiwu, a city of nearly 20 lakh people, punches far above its weight in global exports, shipping goods worth $81 billion last year — $11.5 billion to the US. alone. At the city’s airport, signs proclaim in English: “China goods! Do global business in Yiwu!”
Yet the market, though still busy, is increasingly tense. There are few American buyers, and vendors are wary of speaking openly, with many glancing nervously at officials. Even those not selling to the US are anxious, as global uncertainty looms.
“Decorations might be the first thing people cut,” said Li Xinyao, who sells imitation flowers. “If we cannot lead a happy life, who will care about decorations?”
Li’s family has run their stall since 1993. Though their business doesn’t currently serve the US, she worries about the ripple effect. “The Americans always impact the world,” she said. “When they start a trade war, everyone worries.”
Others are already shifting focus. Nie Ziqin, who sells Halloween items, once sent half her products to the US. Now, she’s pivoting to Europe and domestic buyers. “I still have the EU market and e-commerce,” she said, gesturing at her shop full of ghoulish masks and pumpkin lanterns. “Last year, we started designing for the Chinese market too.”
Since 2018, China has worked to reduce its reliance on American trade. The US share of China’s exports has dropped from 19.2% to 14.7%. Vendors in Yiwu are following suit, funnelling unsold stock into alternative markets.
Online, nationalist sentiment is growing, with many supporting Beijing’s recent decision to raise tariffs on US goods to 125%. “Our government is doing good in these things,” said Li.
Still, she admits she worries “every day” about what it means for her young daughter — and struggles to understand the motives behind the trade war. “We want world peace,” she said. “I really don’t understand why they would do this.”
Like many others, she hopes the two nations can reconcile. But even if they do, for Yiwu’s vendors, some damage may be irreversible. “Now, when we shop, we check if something’s from the US,” said Ran. if something is from the US, she opts not to buy.
