[Spark VC Weekly Insight] U.S.-China Tariff Policy Update: Impact on Cross-border Startups

Policy Update

On April 23, the Office of the United States Trade Representative (USTR) announced that the Section 301 tariffs on certain Chinese goods, originally set to expire this year, are likely to remain in place pending further review. Key sectors affected include electronics, machinery, and some raw materials frequently used by startups in hardware, consumer goods, and biotech sectors.

Impact on Early-stage Entrepreneurs

Rising Supply Chain Costs: Higher input costs for hardware startups relying on Chinese manufacturing.

Investor Caution: Some venture capitalists may become more conservative on capital-intensive projects with supply chain exposure.

Increased Interest in Southeast Asia Manufacturing: A growing trend of supply chain diversification among startups.

Spark VC Perspective

We believe that while tariff uncertainties add short-term pressure, they also encourage founders to build more resilient and diversified global strategies. For startups operating in cross-border markets, proactive supply chain risk management and clear communication with investors remain key to navigating the current environment.