USA and China trade relations, cooperation strategy

The United States and China continue to elevate the tariffs imposed on one another as part of their ongoing trade war. As each country remains retaliatory to what the other is doing, the jan/san industry is one of many being caught in the crosshairs. Recent tariffs the U.S. has imposed on goods from China could lead to declined sales, reduced revenue, layoffs, and more, say industry experts.

The Office of The United States Trade Representative officially released Sept. 18 a list of roughly $200 billion worth of Chinese imports that it will subject to tariffs. An initial 10 percent tariff was placed on the items on Sept. 24 and will increase to 25 percent Jan. 1, 2019. The round of tariffs are the third in a series the U.S. has imposed on China for what the USTR says is a “continuing response to China’s theft of American intellectual property and forced transfer of American technology.”

The office announced in June that tariffs would be placed on around $34 billion worth of imports from China, and announced tariffs on $16 billion worth of product in August.

The National Association of Chemical Distributors commissioned John Dunham & Associates, an economic research firm based in New York, to analyze what the possible third round of tariffs could do to that industry. The firm concluded that a 25 percent tariff on $200 billion in products would increase the expenses of U.S. Chemical Distributors by as much as $1.2 billion, says Matt McKinney, senior manager of public affairs for the National Association of Chemical Distributors.

The second round of tariffs could cause a price increase of $96.3 million for chemical distributors, John Dunham & Associates concluded in a separate study. The first round will not have an impact on the industry, says McKinney.

“Each individual company will be impacted differently depending whether or not they import from China,” says McKinney.

Ultimately, McKinney believes the cost of the tariffs will be passed down to the customer. But the other results discussed could also come into play. Some companies will have to cut jobs. And those that don’t have to cut jobs will at least not have the capital to hire new employees.

ISSA has also expressed great concern with the tariffs the U.S. will impose. The association sent the United States Trade Representative in August a letter expressing strong disagreement with the tariffs the U.S. has imposed against China.

The majority of the products related to the cleaning industry that have been or could be impacted by the tariffs are intermediate parts or ingredients manufacturers would use to develop things like mops, buckets, brushes, and cleaning product formulas, says the letter.

Written by Jake Meister