The Shoe Industry Wants President-Elect Biden to Tackle These Issues

As President-elect Joe Biden prepares to take office, the shoe industry is urging the new administration to act on two major issues that could help strengthen American companies and consumers.

In a letter yesterday, the Footwear Distributors and Retailers of America appealed to the government, seeking the removal of existing punitive tariffs on shoes and a reentry into the Trans-Pacific Partnership, which is now referred to as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.

“We need these actions because American families are already paying tens of millions more than they should this year as a result of antiquated trade policies,” wrote president and CEO Matt Priest.

According to the trade group, footwear companies deliver more than 2.4 billion pairs of shoes to the United States market each year. That’s about 7.4 pairs of shoes for every person in the country.

Over the past four years, President Donald Trump has imposed hundreds of billions of dollars of tariffs on imports from foreign competitors, particularly China, which has led to higher supply chain costs and tighter-than-ever margins for many brands, the FDRA said. As a result, some businesses have relocated their production facilities to neighboring Vietnam, which now faces a threat of potential levies following the current administration’s launch of a Section 301 investigation into the country.

The FDRA reported that, while tariff rates on imported consumer goods average roughly 1.9%, footwear duties typically start at 12% and can reach rates of up to 67%. It added that the highest rates often fall on lower-value shoes and children’s shoes — raising costs for working-class Americans.

In connection with the issue of levies, the FDRA asked that the new government support the CPTPP agreement, which was signed in February 2016 and incorporates the majority of the TPP provisions by reference. (Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam all formally signed the CPTPP in March 2018 — two years after Trump withdrew from the deal.)

In the letter, the FDRA shared that the CPTPP would generate $6 billion in savings for the footwear industry across the first decade of its implementation.

“This agreement offers a critical strategic tool for U.S. leadership in the Asia-Pacific region and a way to drive change without imposing tariffs on U.S. companies,” Priest added. “The agreement would create significant economic opportunities for U.S. businesses, farmers and consumers.”

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