With the 90-day moratorium on additional tariffs on all US imports, except those from China, Asian manufacturers are rushing to secure sufficient containers and shipping slots. Some are hoping to get a year’s worth of stock out.
Taiwanese lawmakers today visited manufacturers in the industrial city of Taichung and listened to their feedback about the tariffs. Representatives from the Taiwan Machine Tool & Accessory Builders’ Association (TMBA), bicycle makers, as well as other manufacturing sectors, were present.
On 5 April, all US imports were slapped with a basic 10% tariff, with additional tariffs, varying by country, to be implemented on 9 April.
However, on 8 April, US president Donald Trump announced a 90-day pause on the extra tariffs, keeping to the basic 10% tariff, except for imports from China.
TMBA chairman Chen Po-chia said: “The initial 32% tariff that the US imposed on imports from Taiwan is very unfavourable for us, and now [with the moratorium], the baseline 10% tariff gives us some breathing space. We hope we can ship out the goods quickly in the next few months, but it’s challenging to ensure there’re enough containers and ships at the port, and whether the goods can be loaded on board quickly.”
Several mainline operators have blanked transpacific sailings in response to an expected decline in volumes, although it remains to be seen if these could be reversed following the moratorium.
Mr Chen continued: “Some goods are currently at sea, and some have been shipped before 5 April, so there is not much impact. We still hope that tariffs can be lowered. If the tariffs of major competitors are lower than Taiwan, there’ll still be pressure.”
Legislative Yuan deputy speaker Chiang Chi-chen said that government should bargain hard with the US government during the 90-day reprieve, saying: “Tariffs are weapons, transactions are the goal, and negotiations are the process.”
Mr Chiang said he had spoken with Taiwanese executives in the US, and they all hoped to ship out their products as soon as possible, almost selling out a year’s supply, because they were worried about what to do after the moratorium.
The Taiwanese government has set aside TW$ 88bn ($2.6bn) to cushion the impact of the tariffs on the island’s industries.
Meanwhile, in Malaysia, furniture makers have also been racing against time to load goods on containers to avoid tariffs being re-imposed after the 90 days.
Associated Press reported that in Muar, a furniture production hub, factories are rushing out production to ship as many containers as possible before the 90 days are up. The US accounts for 60% of Muar’s furniture exports.
Peihing Tsai, CFO at Malaysian furniture maker Corporate Specialist, was quoted as saying: “We are working overtime now and trying our best to motivate our workers, because these three months will be very busy.”
Source: By Alison Koo, The Loadstar
Supply chain strategists can use GSCi – Ti’s online data platform – to identify opportunities for growth, support strategic decisions, help them stay abreast of industry trends and development, as well as understand future impacts on the industry.
Visit GSCI subscription to sign up today or contact Michael Clover for a free demonstration: [email protected] | +44 (0) 1666 519907
For your logistics and transportation management needs
Providing high frequency logistics and supply chain data and analysis for all those invested in the industry.