The United States has released its list of targeted tariffs for the $50 billion it will hit China with, and the tit-for-tat on tariffs could mean another target list from China is forthcoming.
There are 1,300 products from China that will now face tariffs as high as 25 percent, which the U.S. has put in place because of what it deems China’s unfair practices surrounding intellectual property and forced technology transfer. Though the list doesn’t target apparel and footwear products directly, it does hit largely at the machinery and tools used to produce those products—which could dampen prospects for Made in USA, as bringing in the machinery to make it could cost as much as 25 percent more.
In the list, released Tuesday, the Office of the U.S. Trade Representative said it has “determined that the acts, policies, and practices of the Government of China related to technology transfer, intellectual property, and innovation covered in the investigation are unreasonable or discriminatory and burden or restrict U.S. commerce.” As such, a note in the list continued, “The Trade Representative proposes an additional duty of 25 percent on a list of products from China.”
That list, though aimed largely at the aerospace, information technology and robotics industries—includes more than 80 products tied directly to machinery for apparel and textiles manufacturing.
“We are pleased with the administration’s decision to avoid adding tariffs to U.S. imports of apparel, footwear, and travel goods from China,” American Apparel and Footwear Association president and CEO Rick Helfenbein said in a statement immediately following the news. “At the same time, we are concerned that the list includes tariffs on machinery used in our domestic manufacturing process. This would directly raise costs on domestic manufacturers and impact our ability to grow Made in USA.”
Here’s a Breakdown of What’s Actually Going on in the US Textile Industry
The China Tariff List will impose new tariffs on things like: textile printing machinery, carding machines for preparing textile fibers, textile spinning machines, machinery for producing textile yarns, weaving machines, circular knitting machines, flat knitting machines, embroidery machines, spindles and sewing machines—and many of the parts that go into operating those machines.
When it comes to footwear tariff lines, no additional duties were levied there either, though machinery for preparing tanning or working hides, skins or leather, and machinery for making or repairing footwear will face the tariffs.
“Including footwear on the list was a very real and substantial threat to footwear workers and consumers across the country, and we are very pleased that we can take a deep sigh of relief,” said Matt Priest, president and CEO of Footwear Retailers and Distributors of America.
As tariffs are often little more than a hidden tax on consumers, prices in the textiles and apparel sector could face increases as the new tariffs drive up the cost of doing business. Manufacturers may not be able to absorb a new 25 percent tariff without passing at least some of the costs on, which could come in the form of higher prices for apparel.
Tuesday’s tariff announcement likely won’t end the back-and-forth between the U.S. and China on tariffs, either, as China has already responded with $3 billion worth of tariffs following the U.S. steel and aluminum tariff order, and it’s expected to act similarly in reaction to this new set of tariff targets.