Section 301 tariff costs motivated a third of global supply chain “leaders” to move sourcing out of China or to make plans to do so in the next three years, Gartner reported June 24. Gartner, a research and advisory company, canvassed 260 fulfillment companies and contract manufacturers in February and March and found COVID-19 was “only one of several disruptions that have put global supply chains under pressure,” it said. The U.S.-China trade war “made supply chain leaders aware of the weaknesses of their globalized supply chains and question the logic of heavily outsourced, concentrated and interdependent networks,” Gartner said. China for decades was the “go-to destination for high-quality, low-cost manufacturing,” but the tariffs abruptly changed that profile, it said. The Section 301 duties raised supply chain costs by up to 10% for more than 40% of respondents, it said. For more than a quarter of them, “the impact has been even higher,” it said. Vietnam, India and Mexico are top alternative countries of origin. The desire to make supply networks more “resilient” is the second main motivator behind tariffs chasing companies out of China, it said.
It's unclear how a President Joe Biden would try to use policy to shape the global supply chain, but the Atlantic Council's Asia Security director said that since Biden prefers a multilateral approach, he “might be less likely” to impose tariffs or export controls. Miyeon Oh, who was speaking during an Atlantic Council webinar June 26, said he might try to get allies to coordinate an effort “to rebalance the global supply chain,” and he might seek to use American participation in the Trans-Pacific Partnership as a way to do so.
The Office of the U.S. Trade Representative is requesting comments on whether all the tariff exclusions granted to Chinese imports on Section 301 List 4 that are set to expire Sept. 1 should be extended for up to another year, it said in a notice. The agency will start accepting comments on the extensions on July 1. The comments are due by July 30, it said. Each exclusion will be evaluated independently. The evaluation's focus will be whether, despite the first imposition of these additional duties, the particular product remains available only from China. The companies are required to post a public rationale.
The Office of the U.S. Trade Representative is requesting comments on whether to extend by up to another year tariff exclusions on Chinese imports on Section 301 List 2 that are set to expire Sept. 20 (see 1909180013), it said in a notice. The agency will start accepting comments on the extensions July 1. Comments are due July 30, it said. Each exclusion will be evaluated independently, focusing on whether, despite the first imposition of these additional duties, the particular product remains available only from China. The companies are required to post a public rationale.
The Democratic National Committee chairman, and progressive star Sen. Elizabeth Warren, D-Mass., described President Donald Trump's trade war with China as a failed attempt at getting tough on China that hurt Pennsylvania exporters and manufacturers. “China smelled Trump's desperation and played him like a fiddle,” DNC Chairman Tom Perez said on a video conference call with reporters June 24. “He lost the trade war that he started.”
The Office of the U.S. Trade Representative is requesting comments on whether tariff exclusions on Chinese imports on Section 301 List 2 that are set to expire Oct. 2 (see 1909300041) should extend by up to another year, it said in a notice. The agency will start accepting comments on the extensions July 1. The comments are due by July 30, it said. Each exclusion will be evaluated independently. The focus of the evaluation will be whether, despite the first imposition of these additional duties, the particular product remains available only from China. The companies are required to post a public rationale.
The following lawsuits were filed at the Court of International Trade during the week of June 15-21:
CBP added June 18 the ability in ACE for importers to file entries with recently excluded goods in the fourth tranche of Section 301 tariffs, it said in a CSMS message. The official Office of the U.S. Trade Representative notice for the exclusions was published June 12 (see 2006090003). The exclusions are in subheading 9903.88.49. The exclusions are available for any product that meets the description in the Annex to USTR’s notice, regardless of whether the importer filed an exclusion request. The product exclusions apply retroactively to Sept. 1, 2019, the date the tariffs on the fourth list took effect, and remain in effect until Sept. 1, 2020. The CSMS message also includes a summary of Section 301 duties that shows information on each tranche of tariffs and granted product exclusions.
International Trade Today is providing readers with some of the top stories for June15-19 in case they were missed.
Correction: The new Section 301 tariff exclusion for motorboats will fall under previously created subheading 9903.88.48 (see 2006190034).