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Sourcing Journal Podcast, Episode 20: Tariff Workarounds & Worst-Case Scenarios

As we enter the midpoint of the USTR hearings on the proposed Section 301 tariff list, some of the now-familiar questions surrounding tariffs have once again cropped up: What will the tariffs include? When will they go into effect? What kind of fallout should we expect? Is there anything we can do?

In this special podcast, Sourcing Journal founder and president Edward Hertzman talks with AAFA executive VP Stephen Lamar about these pressing uncertainties, as well as the potential implications of President Trump’s upcoming meeting with China’s President Xi Jinping and why China could be benefiting from the trade war in more ways than one.

“Smart governments will use trade agreements to do those things that they’ve been trying to do—and they perceive they want to do for the long term—that they haven’t been able to do because they’ve got domestic political opposition,” said Lamar. “So the fact that they’re doing something in conjunction with an international agreement helps give them the cover to actually do these things that might have been difficult to do domestically.”

“We all know in the industry that the Chinese government has been subtly, and in some cases not so subtly, trying to encourage the industry—apparel and footwear and some elements of textiles—to move out of China. That’s something that’s been going on for years now. And so this … is just following along with something they’ve been trying to do for a while now,” he noted.

Listen to learn:

  • The worst-case scenario of when apparel could be hit (hint: it’s earlier than you think)
  • The strategic reason tranche 4 is unlikely to face the full 25 percent tariff all at once
  • Whether tariffs will continue to be used as an enforcement mechanism
  • Whether the holiday season will hang in the balance
  • Which country you should be monitoring in addition to China and Mexico
  • The De Minimis “loophole” and why it’s changing the supply chain
  • Workarounds to mitigate the potential increases
  • What you need to know if you intend to change your Customs classification

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