U.S. Firms In Unison At Washington Hearing: We Need China
Multiple American companies from various sectors stood at a Washington hearing on Monday in defense of China. The firms said they have little to no substitute aside from Chinese suppliers to support their businesses.
According to Reuters, witnesses said during the hearing that importing from other countries other than China will be equivalent to added costs. The statements were heard by officials from the U.S. State Department, Commerce Department, and the U.S. Trade Representative's office.
While Vietnam has been in the midst of talks regarding potential relocation from Chinese plants, dozens of American companies said moving operations could mean losses for a couple of years.
President of Regalo International LLC Mark Flannery argued that pricing quotes from Vietnam were 50 percent higher than the prices offered by the firm's current Chinese suppliers. Mexican steel imports were even higher than Vietnamese offers.
Flannery further explained that outside of China, there are no countries manufacturing the metal baby gates that his company uses. Regalo sells baby gates, play yards, and child booster seats.
President of the American Apparel and Footwear Association Rick Helfenbein echoed Flannery's statements. He said the planned tariffs of "25% is just going to whack us on the head," referring to costs that come with relocating away from China.
Multiple other sectors are expected to get hit by U.S. President Donald Trump's plan to impose 25 percent in tariffs on the rest of Chinese imports. For Chief Executive of Kenneth Cole Productions, Marc Schneider, the tariffs would mean jobs lost and profits in limbo.
Schneider pointed out that if supplies were imported from other countries other than China, the quality of footwear sold by Kenneth Cole would be lower. Furthermore, prices are expected to go up since raw materials are heftier from non-Chinese providers.
Hearings on potential tariff impositions came amid escalated tariffs wars between Beijing and the White House. The U.S. government said China failed to follow through with commitments on the potential trade deal. China said it was the U.S. that reneged on initial agreements.
Ever since relations between China and the U.S. fell through in May following U.S. accusations, Trump slapped 25 percent of tariffs on around $200 billion in Chinese products. Beijing slapped back on some U.S. imports to China.
The U.S. Chamber of Commerce has reportedly sent a letter to the Trade Representative's office, in a bid to reverse the tariffs that have been hurting American firms just as these delivered a beating to Chinese suppliers.
The Chamber's letter pleaded Trump and his administration to initiate negotiations with Beijing in hopes of striking a deal that will put an end to the tariff war. The letter reportedly noted that existing tariffs are disrupting "the livelihood of all Americans."
Reports on the letter emerged a week after Chairman and Chief Executive of Morgan Stanley, James Gorman, warned the White House of a trade war resulting in a massive "disaster" that could drive the American economy into recession.
Meanwhile, it is expected that shoppers during the festive seasons will be hit hard if Trump pushes through with another round of tariffs on Chinese goods. The products that could have higher price tags include various toys, technological products, ornaments, and more.