China and the USA have signed phase one. Following this deal, they are going to sign (in the future) an additional agreement to settle trade relations between the two countries. Most of all, this is the first real easing of tensions, quite relevant indeed, after a long-lasting trade war, which has been going on for 18 months. Liu He, China’s deputy Prime Minister achieved a successful accomplishment during his stay in Washington: in fact, on January 15 they reached an agreement at last. As summarized by Reuters, Chinese government agreed to augment their import of commodities and services up to 200 billion dollars, in the next two years, while the USA are going to halve customs duties imposed since September. However, they still have a lot to negotiate. US fashion players have warmly welcomed the agreement. Yet, despite that, they are not fully satisfied about it.
China and the USA have signed phase one
Matt Priest, chief executive officer of FDRA (Footwear Distributors and Retailers of America), hopes, for example, that the USA will take further action. Although phase one “has not removed all retaliation duties formerly imposed by President Trump on US manufacturing companies and, therefore, on US buyers – he pointed out – it lays reliability, to some extent, for the new year”. Furthermore, he does not underrate at all the importance of safety in the business scenario: “That is very important as to price stability, in the footwear market – continued Priest – and for an occupational boost as well”. FDRA chief executive officer asks for more bravery, as we said. “Despite the removal of some duties, taxes imposed on footwear still amount to 12.2% on average, and even reach 67.5% as for a few products for childhood”, wrapped up Priest. According to a real, challenging foreign policy, they should not only restore former duties, as they used to be before Trump, but also carry out further reduction”.
Fashion industry is not happy
Steve Lamar, President and chief executive officer of AAFA (American Apparel and Footwear Association) sent a similar message in his press release: “Thanks to such agreement, they have reduced duties to a very limited extent, considering they implemented the most remarkable duty raise since the Great Depression – he emphasized –. All products hit by Trade War, namely footwear, apparel and home fabrics, will still have to deal with a difficult situation because of a duty that also affects buyers, in the end”.