President Donald Trump took to Twitter late today to strike back at China for slapping retaliatory tariffs on U.S. imports — and the trade war appears to be deepening by the hour.
Trump said he would raise tariffs on 300 billion dollars of Chinese imports, set to go into effect starting Sept. 1, to 15% from 10%. (That number is still less than the 25% Trump first announced this spring.)
“The President saying he will enact even higher tariffs is a continued nightmare for footwear workers and shoe consumers. We’ve done the math, and there is zero doubt shoe prices will rise, hurting poor families the most,” said Matt Priest, CEO of FDRA. “This uncertainty may directly plunge us into a recession where we shed thousands of American footwear jobs. This is not hyperbole.”
Trump also plans to hike tariffs on 250 billion dollars of Chinese products already being taxed to 30% from 25%. (That batch doesn’t include footwear.)
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The move came hours after the Chinese Ministry of Commerce said it would impose levies of 5% on soybeans and crude oil starting Sept. 1 as well as tax another tranche of products, including automobiles, at 10% on Dec. 15.
“For many years, China (and many other countries) has been taking advantage on trade, intellectual property theft and much more. Our country has been losing hundreds of billions of dollars a year to China, with no end in sight,” Trump tweeted.
The action came after the stock market fell 623 points on Friday, igniting investor concerns. Trump also ordered U.S. companies to start looking to alternatives to China.
According to the American Apparel and Footwear Association, more than three quarters (or 77%) of all shoes, clothes and home textile imports to the U.S. from China — amounting to about $39 billion worth of goods — will be taxed beginning Sept. 1.
“Clearly the Trump administration’s use of tit-for-tat tariff hikes are not part of any coherent strategy for China. For two and a half years we have been promised a new and innovative approach, yet what we’ve been given is a 1930s trade strategy that will be a disaster for American consumers, American businesses, and the American economy,” said AAFA president and CEO Rick Helfenbein. “Meanwhile, the President has said he wants American businesses to stop working in China, yet he doesn’t seem to understand that moving a supply chain is incredibly complicated and expensive. It takes years to build relationships that meet compliance standards and deliver quality products, yet we have been given weeks and in this case days.
Many companies have already begun relocating their supply chains to neighboring countries like Vietnam, Indonesia and Mexico as costs grow within their China-based supply chains. Some have also indicated that they may be left with no choice but to raise prices for consumers.
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