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U.S.-China Trade War Continues to Disrupt Fashion Brands and Retailers

Sourcing strategies are under constant review, production and sourcing costs are increasing, and American companies and businesses continue to shift supply chains as they try to adjust to the uncertainties of U.S. trade policies that can change with a tweet. While the United States Fashion Industry Association (USFIA) welcomes the Phase One U.S-China trade deal, we continue to urge the Trump Administration to end the trade war with China.

The latest data available from Tariffs Hurt the Heartland, a nationwide campaign against tariffs that hurt American families and communities, finds that American consumers and businesses have paid an additional $46 billion since the trade war began in February 2018 through November 2019. According to the group, in the month of November alone, Americans paid $6.2 billion in tariffs. The data also demonstrates the impact of retaliatory tariffs on U.S. exports. Chinese tariffs on American exports totaled $13 billion since the start of the trade war and hit almost $1.6 billion in November alone as China further raised tariffs in retaliation for U.S. List 4A tariffs.

A recent front-page story in the Washington Post highlights the impact of the trade war on companies and how they are still feeling the pressure of tariffs despite the announcement of the Phase One deal. Peter Bragdon, Executive Vice President of Columbia Sportswear, said the company is still trying to decide whether it must move manufacturing out of China, raise prices for customers, or change products altogether.  “You can try to engineer some products differently,” Bragdon said, “but you can’t engineer your way around chaos.”

The Phase One trade deal does not eliminate the tariffs on fashion products. The tariffs will be reduced to 7.5% for most apparel, but many key items, especially accessories and handbags, remain taxed with an additional 25% tariff.  At USFIA, our mission is to support the industry and Fashion Made Possible by Global Trade. We encourage fashion brands and retailers to continue to pressure the Administration, and the Congress, to find a final solution to the trade war and to understand that uncertainty and unpredictability in trade policy hurts American companies, employees, and customers.

Julia K. Hughes is the President of the United States Fashion Industry Association (USFIA), headquartered   in Washington D.C. Founded in 1989 USFIA represents brands, retailers, importers, and wholesalers based in the United States and doing business globally, and is dedicated to the  elimination of  tariff and non-tariff barriers that impede the fashion industry’s ability to trade freely and create jobs in the United States. (www.usfashionindustry.com