Import Groups Criticize Increased U.S. Tariffs on Chinese Goods

 In Industry News, Trans-Border Global Freight Systems, Inc.

May 16th 2024 – Trade groups representing importers criticized President Biden’s decision to raise tariffs on a range of Chinese imports, arguing that these duties will increase supply chain costs and result in higher prices for consumers.

“Broad-based tariffs are not strategic and will impede U.S. economic growth,” said Blake Harden, vice president of international trade at the Retail Industry Leaders Association, which includes members like Apple, Walmart, Target, Best Buy, and Lowe’s.

Harden emphasized that these levies will “hamstring American businesses trying to compete globally and negatively impact the paycheck of American workers.”

David French, executive vice president of government relations at the National Retail Federation, echoed this concern. “As consumers continue to battle inflation, the last thing the administration should be doing is placing additional taxes on imported products that will be paid by U.S. importers and eventually U.S. consumers,” he said.

On Tuesday, President Biden increased tariffs on various Chinese-manufactured goods, including electric vehicles, semiconductors, steel, aluminum, and medical products. The White House announced that it would also maintain the duties imposed during the Trump administration’s 2018 and 2019 U.S.-China trade war.

These tariffs aim to counter what the administration views as China’s aggressive export strategies designed to boost its domestic economy, which the White House believes significantly impact global markets. Additionally, the tariffs seek to trigger a reconfiguration of supply chains, promoting more manufacturing in the U.S. and encouraging nearshoring—shifting production from China to other countries, such as Mexico, to avoid the tariffs.

Factory work in countries such as Mexico, India, and Vietnam has been on the rise. However, John Donigian, senior director of supply-chain strategy at Moody’s, noted that the new, higher tariffs would add “additional risk and complexity to an already strained supply-chain environment.”

The increased efforts by the U.S. and its trading partners appear to be impacting the flow of goods from China.

Beijing recently reported a 1.5% overall increase in exports for the first four months of the year compared to the same period last year, while shipments to the U.S. declined by 1% and exports to the European Union fell by 4.8%. In contrast, China’s exports to Southeast Asian nations rose by 6.3% during this period.

David French from the National Retail Federation (NRF) stated that the Biden administration has not provided sufficient incentives for U.S. companies to shift their supply chains away from China, such as negotiating new trade agreements.

“We need new free trade agreements that focus on both market access and tariff reductions,” French said.

The lack of new trade pacts has frustrated some industry groups that had hoped for a shift toward more open trade policies following the protectionist stance of the Trump administration.

“Regrettably, the Biden administration has done nothing to negotiate new trade agreements or improve current trade agreements to make them more competitive,” said Beth Hughes, vice president of trade at the American Apparel and Footwear Association, which represents apparel retailers and suppliers.

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