< PrevNext > Donald J Trump, President of the United States Trade Warrior By Elizabeth West / December 13, 2019 / Contact Reporter Share Just as Beijing and Washington, D.C., were said to be "close" to a deal on their ongoing trade war, the brinksmanship escalated again at press time, with lead White House economic advisor Larry Kudlow stating to CNBC that president Donald Trump was prepared to "walk away" if he can't get to the terms he wants with Chinese president Xi Jinping.That specter could send a chill through the corporate travel community, with corporations, hotels and airlines already on tenterhooks about the next step in a tariff battle that started in July 2018 when the U.S. imposed 10 percent tariffs on $34 billion in Chinese-made industrial components imported to the U.S. China immediately retaliated with tariffs on $34 billion in agricultural products like soybeans and pork as well as electric cars. The tit-for-tat has continued apace, with tariffs so far ranging from 10 percent to 25 percent on $550 billion in Chinese goods to the U.S. and $186 billion on U.S. goods to China. In its latest move, China directed all government entities to ditch foreign-made hardware and software within three years—an order that triggered Trump's "walk away" threat and that could deliver a significant blow to major U.S. providers like Dell, HP and Microsoft. The trade war didn't register immediately on the corporate travel industry. As recently as January, American Express Global Business Travel Asia/Pacific director Philip Haxne commented that U.S.-China traffic remained "pretty stable and the demand is there." Airline and hotel companies were in lockstep; they reported no major disruptions in their first-quarter earnings calls, though they were clearly watching revenue patterns in the region. By the third quarter, however, the pain was widespread.Accor Hotels put out an early indicator in its second quarter earnings, pointing to a slowdown in China's GDP growth and instability surrounding the trade war to explain its weak RevPAR growth in Asia/Pacific during the period. Concerned deepened into the third quarter. International Air Transport Association CEO Alexandre de Juniac signaled alarm, citing dampened air demand growth of 3.8 percent in August, compared to "a roughly 8.5 percent annual growth seen over the 2016 to Q1 2018 period," and pegged the trade war as significant factor. Likewise, Delta reported a 4.6 percent regional revenue decline on Pacific routes in the third quarter, identifying travel declines in the manufacturing and automotive sector, "and that relates to tariffs," according to Delta president Glenn Hauenstein. CWT M&E VP Tony Wagner said the meetings industry took a hit as well, as caution took over the planning process. "Political events have a direct impact more than ever on companies' quarterly and annual outlooks," he said, before directly implicating the U.S.-China trade war. "Some industry segments are pulling back and are being a bit more cautious." Wagner said large events that previously booked at least six months in advance are now booking at an average of three months out, due to geopolitical and economy uncertainty. All eyes are on trade talks as the travel and meetings industries move into 2020.