American shoppers to pay if Trump goes ahead with new tariffs

By Xie Jun Source:Global Times Published: 2019/12/12 22:43:40

A woman sits behind a desk in a shop full of Christmas hats for export in Yiwu, East China's Zhejiang Province. Photo: Ma Jingjing/GT



US shoppers and companies are likely to receive a special Christmas gift from President Donald Trump: higher prices for items ranging from toys to Christmas lights, as the US government is said to implement a round of tariff increases for Christmas-related products imported from China.

Negative impacts from the trade war have already become evident in the run up to Christmas, as some US businesses have increased the prices of products that were hit with earlier rounds of tariffs. 

And these impacts will weigh more heavily on next year's Christmas festivity if the US government on December 15 imposes additional tariffs on Chinese-made products including Christmas ornaments and toys.

For years, US companies have imported a large proportion of their Christmas-related products from China, particularly from China's small-commodity marketplace Yiwu in East China's Zhejiang Province, and manufacturing hub Guangdong Province in South China. 

US companies generally place orders for the Christmas season during the first six months of the year. That means the impact of possible December tariff rise will be largely felt next Christmas, industry insiders said. 

However, as Chinese manufacturers are unlikely to share the extra costs, it will be US companies and civilians who pay the lion's share of the tariffs. 

"I can't share any of those extra costs, whether they come from tariffs or other reasons. This is something for the trading companies or the overseas clients to settle, not me," said Zhu Hongbin, who owns a shop in Yiwu which sells Christmas tinsel.

Zhu said that if it becomes necessary to sacrifice profits due to tariffs, he will have to give up his US customers. "The profit is thin for those products. I can't make any money if the price is lower," he told the Global Times on Thursday. 

On this issue, Zhu speaks for the majority of traders in Yiwu. Cai Qinliang, secretary general of the Yiwu Christmas Products Industry Association and also a Christmas-ornament seller, agreed that Yiwu sellers won't accept the extra costs. 

"We don't care if [US clients] buy from us or not. If they buy [our products], they will have to absorb the tariffs by themselves," he told the Global Times. 

On December 7, the Buffalo News cited a Cheektowaga-based Christmas items seller who said additional costs from previous rounds of tariffs - on products like baskets and furniture - were swallowed equally by the store and its customers. 

But if the December tariffs kick in, everything sold in his store will cost even more, the report noted.  

A Bloomberg report noted that the trade war is ruining Christmas for US toymakers, who are likely to bear the brunt of added tariffs. 

Cai said that Yiwu sellers are not concerned by the tariff changes, as they have successfully expanded their business channels around the globe. Nowadays, only about 5 percent of Yiwu's Christmas-product exports are bound for the US market, he said, adding that business with emerging markets like Peru and Guatemala is growing very quickly. 

"Besides, where can the US find an industrial chain for Christmas products that is as cheap and complete as the one in China?" he said.

Posted in: ECONOMY

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