Articles Posted in #tradewar

trade warAccording to a report released earlier this month, U.S. companies are increasingly shifting imports from China to countries like Vietnam, South Korea, Mexico, and Taiwan, in an effort to avoid the high tariffs imposed on Chinese purchases during the current trade war.

With the current trade war waged on China, President Donald Trump has imposed tariffs of up to 25% on the purchase of Chinese products. This dramatically increases the overall costs that U.S. companies are looking to spend, causing them to search for new alternatives. According to S&P Global Market Intelligence, the number of containerized freight imported from China fell 6.4% in the first corner. In order to avoid paying the high tariffs, U.S. companies have rerouted the majority of their purchases to less expensive countries. However, many companies also chose to order mass purchases from China ahead of the tariff increases in an effort to stockpile their products.

Many of the companies choosing to reroute their imports are associated with the furniture industry, but these are not the only markets struggling to avoid tariffs. While large furniture retailers, like Home Depot and Target, decreased Chinese imports by up to 13.5%, appliance retailers like Samsung and LG were also part of a major shift in Chinese imports.

President Donald Trump has revoked Indias preferential trade status worth $5.6 billion. This affects manufacturers of auto spare parts and casings for wires that are too low on the value chain for American manufacturers to make them in the U.S.  Trump wrote that he is taking the step because “I have determined that India has not assured the United States that it will provide equitable and reasonable access to the markets of India. The U.S. Generalized System of Preferences program, known as GSP, provides duty-free entry into the United States for more than 3,500products from more than 100 countries. India is the largest beneficiary of the program, with GSP imports including thousands of products and totaling $5.7 billion in 2017.

But the blanket removal of the GSP scheme for India means that about 1,900 products exported by the country to the US will be hit. “Popular items that India exports to the US under the GSP programme includes many intermediary products such as mechanical spare parts, ferroalloys, food products, gems and jewelry, textile products, electronic products like motors, wires

India has one of the fastest-growing economies, with top exports to the U.S. including precious metals and diamonds, mineral fuels and aircraft. “India is a very high-tariff nation. They charge us a lot. When we send a motorcycle to India, it’s 100 percent tariff. They charge 100 percent. When India sends a motorcycle to us, we brilliantly charge them nothing,” Trump said.