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Trump’s China Tariffs Expected to Have Minimal Impact on Footwear

Though tariffs are flying left and right across the Atlantic, footwear seems to have largely dodged the bullet.

On Tuesday, the Office of the United States Trade Representative released the list of 1,300 targeted Chinese products that will be subject to new tariffs reaching 25 percent, and hours later, China hit back with its own list of 106 U.S. products that will face a similar tariff.

Though the domestic apparel sector may take a substantial hit thanks to U.S.-levied tariffs on textile and apparel manufacturing machinery, the impact on footwear is expected to be minimal.

Five tariff lines tied to footwear—injection molding machines, machinery for making or repairing footwear, parts of machinery for making or repairing footwear, non-automatic sewing machines designed to join footwear soles to uppers, and automatic sewing machines designed to join footwear soles to uppers—made the list of products coming from China set to face tariffs.

In looking at how the addition of those tariffs will impact the footwear sector, however, the Footwear Distributors and Retailers of America said Tuesday, “What we found in the machine data is that there is very little cost impact on our domestic footwear producers importing manufacturing machines for production. This is due to the low amount China supplies versus the abundance of global sourcing options for these types of machines.”

Most of the shoe machinery imports from China that are being hit with the tariffs are on the decline, according to FDRA, which said the combined categories saw a 41.47% decline in dollar terms last year compared to 2016.

“Only one import category of this machinery from China grew in 2017—sewing machines to attach uppers to soles—yet in that same category companies imported more of these machines from Germany, U.K. and Honduras,” FDRA said.

What’s more, in addressing its members, largely comprised of domestic shoe manufacturers, FDRA said many have been purchasing higher-end machines from places like Germany, Italy, the U.K. and Korea, rather than solely from China. China’s share of America’s total imports of machinery for shoes is just 5.7%.

The newly-levied tariffs from the U.S. on China are tied to what the U.S. claims has been the country’s unfair practices around intellectual property and forced technology transfer from U.S. companies to Chinese entities in order to do business there.

China has asked that the U.S. meet them at the negotiating table to discuss the trade matters at hand, in hopes of ending what has become a back-and-forth battle on tariffs.