“The uncertainty is still there,” says John Frisbie, former president of the U.S.-China Business Council. The referenced uncertainty has to do with the hopeful deal that China and the White House made last week, which loosely outlines China’s promise to purchase more farm goods from the U.S. What is not clearly written, is exactly how much to be purchased, the timeline in which these goods must be purchased and what the United States will have to compromise as a condition of this trade deal. Uncertainty is the correct word to use and it remains the theme of this planet impacting trade war.
A deal was reached on October’s planned tariff hike, but all eyes remain on December, where another $156 billion in Chinese goods are expected to be hit with rises in tariffs.
Before the tit-for-tat began with China in 2017, Beijing was purchasing almost $25 billion in agricultural goods from the United States per year. Since then, they have plummeted to $9.2 billion over the last 12 months according to Commerce Department data. While the White House remains hopeful that China will increase purchases to over $50 billion in the next 2 years, it seems unlikely and would require China to stay compliant with World Trade Organization rules and also look internally at its own biotechnical regulations and restrictions around beef and pork purchases. Beijing uses its agricultural purchasing power as a tool to leverage the US President, and since this trade war began American farmers have endured the lowest sales in close to a decade.
A deal was reached on October’s planned tariff hike, but all eyes remain on December, where another $156 billion in Chinese goods are expected to be hit with rises in tariffs. For American business owners that import and export goods to and from China, these headlines are a call to action and the persistent uncertainty surrounding these tenuous trade talks is the catalyst. If you have been waiting on the sidelines for things to blow over, you are falling behind and losing your competitive advantage. It has been 2 years since this trade war started with China which has spread to Europe, causing fissures in trade agreements across the globe.
It’s time for you to take back control of your profits, ease the tariff tax burden and mitigate the risk to your bottom line by using Foreign Trade Zones as a means to import and export your goods. Foreign Trade Zones allow you and your business to park goods and even manufacture products in designated areas while delaying or lowering tariff and custom tax costs and put you back in the driver seat. The experts at Tri-Link, Inc. have Free Trade Zones stationed in strategic locations across the U.S. like Los Angeles, Miami and New York that allow convenient storing of your goods and advantageous manufacturing of your products. Do not wait for another headline to punch your profits in the gut. Call Tri-Link today and learn how to take back the reigns of your business.