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The tariff saga continues between the United States and China, with new updates as of December 12, 2019. After much deliberation, and months of negotiations, the two countries have agreed to what is being called a “Phase One Trade Deal.” The agreement means that the U.S. tariffs on $160 billion of imported Chinese consumer goods projected to go into effect last week have been suspended. To add to this news, the September tariffs on imported consumer goods like clothing and sports equipment have been cut in half.
According to the Office of the United States Trade Representative, “The United States will be maintaining 25% tariffs on approximately $250 billion of Chinese imports, along with 7.5% tariffs on approximately $120 billion of Chinese imports.”
As part of this trade deal, China will be required to make “substantial” additional purchases of U.S. goods and services in the coming years. The country also agreed to structural changes, which the U.S. Trade Representative reports will happen in their economic and trade regimes, specifically in the areas of “intellectual property, technology transfer, agriculture, financial services, and currency and foreign exchange.” Upon signing this deal, a dispute resolution system will be put into place between the two countries.
What That Means For Us
In the sock industry, this means our products on list 4a, which received a tariff increase in September, will receive the reduced rate of import tariff agreed to by China and the U.S. Plus, the additional tariffs slated to go into effect on the list 4b items on December 15th have been postponed. In the coming weeks, as more details are released about the specifics of the deal, we will have more information on the direct impact to our company.
The reality of trade relations is that things can change at any time. We plan to continue monitoring the situation and updating our articles as new information becomes available. In the meantime, you can find a full list of tariff information resources here.
If you would like to see the official reports from the Office of the United StatesTrade Representative, click here.