By Rebecca Heilweil
Today the White House announced that it had reached a deal to end tariffs on steel and aluminum from Canada and Mexico, easing ongoing trade tensions and signaling that a new, North American trade agreement could be in sight.
But there’s no sign that warmth yet extends to China, which remains the United States' largest goods trading partner.
With trade talks between Beijing and Washington stalled as of Friday afternoon, retailers are now scurrying to mitigate the impact of Trump’s decision to raise tariffs on more than $200 billion worth of imports from China. The change will likely ripple through their supply chains, and retail outlets believe that ultimately, costs will fall on consumers.
David French, the senior vice president of government relations at the National Retail Federation, told Cheddar that Trump’s proposed tariffs, along with the impact of retaliation, could ultimately cost the average family of four as much $2,300 annually, and cost the United States more than 2 million jobs.
Oxford Economics, a research firm, found that the tariffs will essentially reverse the 2017 tax cuts for middle- and lower-income Americans.
“There’s no other place in the world that has the capacity of China,” said French. “The range of products that will be affected is quite broad. Everyday items from toilet paper to toothbrushes to bicycles, luggage, apparel, footwear. You name it, a lot of different products will be impacted. And even products that don’t come from China will be impacted.”
Major companies like Macy’s and Walmart are looking for ways to minimize the hurt. For instance, on an earnings call, Macy’s executives told investors that the tariffs would most significantly hurt its furniture businesses, but that the duties’ impact “can be mitigated.”
Even Walmart, the world's largest company by revenue, has admitted that costs for consumers will rise.
And small businesses could feel even more of the pain. “The larger retailers have the ability to manage their costs more efficiently. They may be able to push back some of the cost on their suppliers, on their vendors. There may be able to find other ways to minimize the harm,” said French. “A small business buys product ー typically ー from the company that imports it. And those costs are almost always passed along fully."
For full interview click here.