There is good news coming in as a de-escalation of tariffs for shippers from China whose merchandise was on one of the first three lists published by the US Trade Representative. As a gesture of goodwill to China for granting the first exemptions from additional duty on sixteen American products the US has pushed back the tariff increase from October 1st until October 15th as the first is a special day for China to celebrate the 70th anniversary of the People’s Republic of China. President Trump still plans to increase the duties from the current 25% to a proposed 30% though both sides seem eager to find a trade balance, hopefully before new increases happen.
Alongside the increases coming on October 15, 2019 there are new tariffs coming on the second half of the 4th tranche of tariffs due December 15th. This list was also pushed back, this time to help US consumers make it through the holiday season without serious price increases on consumer goods. The fear of a global recession coming from the two nations spatting about duties has gripped many retail companies. They’ve battled back by front loading cargo for the holidays, hoping to have inventory that will last through the season to keep prices low and merchandise moving.
With a Chinese delegation set to come to the US next month for more talks and rumors of an attempted decoupling of trade and national security issues to advance the negotiations, perhaps there cause for optimism.
We at Nelson International will keep an eye on these issues and bring you more news as it’s available. We are still waiting for these headlines to be officially marked in the federal register by the USTR and will update this piece accordingly.