Tariff & Non-Tariff Trade Barriers They’re Not Good For Anyone


On May 18, 2019, an agreement was reached between Canada, the U.S.A. and Mexico that ended all US Section 232 tariffs on steel and aluminum.   In return, Canada and Mexico eliminated the retaliatory tariffs they had put in place such as the 20% duty on U.S. frozen potatoes sold into Mexico (Mexico is the third largest export market for U.S. fries), and a 10% tariff on frozen pizzas, sauces, quiche and soups sold in Canada. These positive actions pave the way or at least removes some of the previous obstacles for the passage of the USMCA (United States-Mexico-Canada) trade agreement hopefully later this year.

That was the good news. But then on May 31 st Trump announced a 5% duty on all goods (including foods) imported into the USA from Mexico effective June 10 until the flow of immigrants stops.

And in Japan, they’ll soon be enjoying more U.S. beef again. On May 17, 2019 the U.S. and Japan reached a trade deal to lift the beef import ban clearing the way for the U.S. products to enter the market, regardless of age. This ended the previous age ban that had been effect since July 27, 2006. That’s good news.

However, on the China-U.S. front things are not as rosy and seem to be spiraling downward as China digs in its heels and prepares for a lengthy battle until both sides can come to agreement without losing face.  U.S. President Donald Trump recently banned U.S. companies from providing technology to Huawei – this on top of raising tariffs on $200 billion in Chinese products in mid-May.  China has retaliated by imposing tariffs of up to 25% on U.S. food products including frozen vegetables and french-fries (China is now the 6th largest market for U.S. potato products and it could be more), honey, rice, corn and wheat flour as well as processed oats, on any plant that may be used as a spice, virgin olive oil, peanut, soybean, sunflower, coconut and sesame oils, soda and bottled water, spirits including gin, tequila, vodka and other alcoholic beverages. This is just a few of the products!

In addition, U.S. companies should expect longer delays on getting their products into China because of those invisible “non-tariff” trade barriers.  You can be sure that paperwork, documentation and inspections will be stepped up and even the slightest errors will result in rejection or delays. 

All in all, unless there is a shift in attitude on both sides with some mutual give and take, it looks like we are in for a tough time on the Chinese trade front.  Just a few weeks ago, President Xi Jinping took a tough stance too when he called on his people to brace themselves for a “new Long March” – referring to the communist revolutionaries in the 1930’s who regrouped and went on to win in 1949.

Trade wars don’t help anyone.  We are all affected – consumers, manufacturers, shipping companies, retailers and so on.  Let’s hope that Presidents Trump and Xi can get together and sort things out when they meet on the side at the Group of 20 summit in Osaka Japan in late June 2019 – or sooner if possible. 







貿易戦争は、誰にとっても良いことはありません。消費者、メーカー、船舶会社、小売店など、全員が影響を受けます。  6月末のG20大阪サミット、できればそれよりも前に、トランプ大統領と習主席が話し合いに臨み、交渉をまとめられることを望みましょう。



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