On Feb. 1st, President Donald Trump issued three new executive orders to impose tariffs on all imports from the United States largest trading partners: Canada, Mexico, and China. President Trump later announced the final terms of this policy to reporters in the Oval Office, stating that the countries will be given a reciprocal tariff.
“On trade, I have decided for purposes of fairness that I will charge a reciprocal tariff, meaning whatever countries charge the United States of America, we will charge them. No more, no less,” Trump said.
The implementation of reciprocal tariffs has raised questions about the future of the United States. Not only do these tariffs raise the risks of a global trade war, but they also raise the price of Chinese imports in America.
China continues to be one of the United States biggest suppliers. Not only does China provide a significant amount of our electronics, furniture, and machinery, but also our clothing. According to the United States International Trade Commission, in the year 2020, China accounted for 22.7% of total U.S. apparel imports.
The popular Chinese-owned online retailing brands Shein and Temu are a large concern when it comes to a raise in tariffs. The two companies are known for providing fast fashion and accessories at low prices and shipping rates. This increase in tariffs may impact the way these companies are able to cut down costs.
Many college students resort to using fast-fashion websites for new apparel, as the cheap prices are affordable for students who may not be able to afford high-end clothing. With a low budget, shops like Shein and Temu allow students to enjoy new apparel without the added fees.
Dymond Beeler, a nursing student at Florida A&M University, believes this change will inconvenience student shoppers.
“It’s hard to find a good-paying job while being a full-time student, so finding clothes that were both cheap and good quality was convenient.” Beeler said.
In addition, President Trump eliminated the de minimis exemption. This exemption allowed packages valued under $800 to enter into the United States free of charge. The elimination of de minimis has led to increased shipping costs for retailers such as Shein and Temu, resulting in increased prices for consumers.
Deliveries from these brands may take longer; this is due to the fact that all packages will have to undergo screening processes and a full customs clearance moving forward. This will increase the processing time at the border, thus increasing a consumer’s wait time.
If the online retailers Shein and Temu were to become less affordable it is inevitable that consumers may shop at a lesser frequency or decline to shop on these sites completely.
Sophia Busch, the assistant director at the Atlantic Council’s GeoEconomics Center, shared with Newsweek her thoughts on the impacts of increasing prices.
“It may make it more difficult for these companies to sell to U.S. consumers, as their business models are built around the low prices that are possible through this loophole,” Busch said.
These reciprocal tariffs are set to take effect as soon as April.