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- [00:00]
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- [00:15]
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- [00:47]
Ed Butler
Today we're investigating the Chinese city that claims to be the home of Christmas. From the uk, this is Marketplace Morning Report from the BBC World Service. I'm Ed Butler and Merry Christmas to you all. I hope you're having a good Christmas morning. Have you ever wondered where your festive lights, the baubles and the toys all come from? Well, there's a good chance a fair few of them originate in the Chinese city of Yiwu. Join me as we find out more about this place and just how it's being affected by the latest U.S. tariffs. The sound of traders in the town of Yiwu in central eastern China attempting to master Spanish language skills like these are important because Yiwu is a major international trading hub, especially at this time of year selling commodities to a global market. Once a small rural town, Yiwu began gaining a reputation back in the 1980s for its Open air market selling small commodities. Now it's a sprawling international trade center spanning hectares and several floors.
- [02:03]
Han Lin
If you were to imagine that Santa Claus has outsourced all of the production of everything he produces, it would likely be found in Yiwu City.
- [02:12]
Ed Butler
That's Han Lin, China director for the consultancy the Asia Group.
- [02:17]
Han Lin
60% of all of the global production of Christmas ornaments, for example, are all produced in Yiwu. And Yiwu sells to about 500,000 buyers from 200 countries around the world.
- [02:36]
Ed Butler
There are 50,000 shops in all. If you were to spend just three minutes in every one of them, it would take you more than a year to get round the maze of arcades here. Ashley Dudarenok, the founder of a Chinese research and analytics consultancy that works with companies in the city, says that Yiyu's distinctive quality is the spirit of enterprise that drives its thousands of traders. It's one of multiple towns and cities in China built around a very specific category of export.
- [03:07]
Ashley Dudarenok
China likes to have centers of excellence. For example, in Guangzhou, we have a town that's a shoe town or another town that focuses on underwear. And YIWU focuses on small commodities or Christmas decorations, Christmas products.
- [03:23]
Interviewer (Ed Butler)
How did that evolve?
- [03:24]
Ed Butler
Just tell me. I mean, talk to me about that. This dates back to the 90s or something.
- [03:29]
Ashley Dudarenok
Yes, absolutely. First, it was really about manufacturing, you know, Christmas decorations, and it was very much focused on the US Market. And now becoming the real innovator, a company that I personally know of, they produce Christmas ornaments, and they produce Christmas balls. They are able to assemble a Christmas ball in about two seconds. So think about that. And their newly developed machines and factory floors ultimately increased their efficiency by about 20%. So by now, they are not just a supermarket for cheap products. They are also an innovation center in many, many ways.
- [04:07]
Ed Butler
That's consultant Ashley Dudaranok. I'm Ed Butler, and today I'm looking at yiwu, the Chinese city hosting the world's largest wholesale market, which itself alone provides the world with more than half of its Christmas decor. But how secure an industry is this, given the growing cost of all this international trade, especially the trade that's going.
- [04:31]
Interviewer (Ed Butler)
To the U.S. so if you look at that China, first row, China, 67%. That's.
- [04:40]
Ed Butler
Ever since the start of his second term in January, President Trump has been introducing, and then sometimes walking back, massive hikes on the import taxes imposed on Chinese goods. It's left many traders and YIWU predictably frustrated.
- [04:56]
Trader in Yiwu
What do you think of Trump?
- [05:00]
He's a joke. He tells jokes every day. Imposing tariffs is like a joke to him. We used to have buyers from the U.S. now we don't care. We have rich buyers from elsewhere. Doing business with them is good.
- [05:18]
Ed Butler
Storeholders in YIWU are no longer as reliant on the US as they once were, switching exports instead to other countries in America. In this sector, as with other imported goods, prices have been rising in the run up to Christmas. I spoke to Mac Harman. He's the founder and CEO of Balsam Hill, a leading brand in Christmas decor.
- [05:39]
Mac Harman
We'Ve had to raise our prices at least 10%. It kind of depends on the category. So, as an example, snow globes, you know, a wonderful holiday treat. We canceled the orders because the tariffs were so high on those that we just decided it didn't make sense to bring in Christmas lights that you hang all over your house. All the advanced ones are generally manufactured in China and those for most of this year had a 63% tariff. And we looked at that category and we said these prices are just too high for consumers. And so we also cancelled those orders.
- [06:13]
Ed Butler
Mac Harmon there. Surprisingly, back in yiwu, there seems to be no sense of a gaping loss in their export market this year. According to the trade consultant Ashley Dudarenok, traders have simply found other markets to tap into.
- [06:27]
Ashley Dudarenok
Instead, Yiwu's Christmas exports actually grew about 23% year over year. Between Q1 and Q3, the industry rapidly diversified into other markets, for example Latin America + 17% EU + 45% year over year. So they started really pushing into new markets and they set up shop there. The push is real and you can see it across the board.
- [06:59]
Ed Butler
That's Ashley Dudaranok rounding off our look at China's Christmas city, Yiwu, where traders will already be looking ahead to Christmas 2026. I hope you're having a great day in the UK. I'm Ed Butler with Marketplace Morning Report from the BBC World Service.
- [07:34]
Maria
Hey everyone. You already listened to Marketplace podcasts so you know that it's important to understand how economic forces shape our lives lives. And that feels especially important now as we're all trying to make sense of the latest headlines. I'm Maria, host of Marketplaces. This is Uncomfortable, a show that explores how money bumps up against our relationships, our choices, and the parts of life we don't always say aloud. And starting January 15th, we are back every single week. New stories, new questions, and the kind of conversations that make you feel less alone in this quickly changing economy. We're tackling questions like should I turn my hobby into a money making side hustle? How do I deal with layoff anxiety? Or what do we owe our parents financially? Don't miss an episode. Subscribe to this is Uncomfortable from Marketplace. Wherever you get your podcasts.