Industry trends

The Latest on Tariffs and Their Impact on Business Strategies [Video and Audio]

  • 2/22/2021
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CLA has contracted with The Franklin Partnership and Omar Nashashibi to provide the content for this video and audio series. We regularly add new clips as changes in the trade war and U.S. tariff policies develop, so check back periodically for the latest updates.

Infographic: Tariff Mitigation and Management

We’ve talked extensively with Omar Nashashibi of The Franklin Partnership and others to record a series of short videos and audio clips that can help you better understand the goal of tariffs, their likely impact on inflation, the current and near-term trade environment, potential global quotas, and strategies for staying competitive. 

Biden Supply Chain Executive Order Video

The Biden Administration is expected to release an executive order calling for a 100-day review of the supply chains in four key areas: semiconductor manufacturing, high-capacity batteries, medical supplies, and rare earth minerals. Omar Nashashibi of the Franklin Partnership in Washington, D.C. discusses government reviews of critical supply chains and what comes next.

Biden Administration Reviews China Trade Deal

The Biden Administration announced it will conduct a review of the U.S.-China Phase I deal negotiated by former President Trump in January 2020. Omar Nashashibi of the Franklin Partnership in Washington D.C., provides an update on the purchases made by China compared to their commitments, as well as the latest actions taken by President Biden to reverse a decision and re-impose tariffs on aluminum.

USTR Suspends France Digital Services Tariff

In an abrupt change, on January 7, 2021, the U.S. Trade Representative announced they would indefinitely suspend the 25% tariffs on French imports valued at around $1.3 billion annually, due to go into effect on January 6, 2021. Omar Nashashibi of the Franklin Partnership in Washington, D.C. provides an update on these tariffs and others imposed on new products from the EU under the Section 301 Boeing-Airbus aviation dispute. Contact your CLA representative to learn how these moves affect you.

 

COVID-19 Tariff Exclusions Extended in Chinese Imports

On December 29, 2020, the Office of the U.S. Trade Representative announced extensions to existing exclusions and granted new exclusions on roughly 100 imported items from China. The USTR began notifying companies of their extensions from paying the 7.5% or 25% tariffs through March 31, 2021. Omar Nashashibi of the Franklin Partnership shares more details.

 

Steel and Aluminum Tariff Exclusion Updates

The U.S. Commerce Department announced three major changes to the Section 232 steel and aluminum tariff exclusion process. Omar Nashashibi of the Franklin Partnership in Washington, D.C. discusses how these changes may impact steel and aluminum users, importers, and U.S. manufacturers.

 

U.S. Vietnam Tariff Hearing

The U.S. is taking steps to potentially impose tariffs on Vietnamese imports in January as part of a Section 301 investigation into currency manipulation. Omar Nashashibi of the Franklin Partnership discusses the timeline for the tariffs which may be imposed by January 20, 2021, as well as other pending tariff actions on France and China.

 

New EU Tariffs on U.S. Exports

On November 10, 2020, the European Union began imposing tariffs of 15% and 25% on $4 billion worth of U.S. exports to European member nations. Omar Nashashibi of The Franklin Partnership provides the latest information regarding the ongoing dispute between the two allies. Learn which U.S. products are subject to the new tariffs and how it may impact American manufacturers and distributors caught in the middle.

 

Vietnamese Currency Manipulation Update

Omar Nashashibi of the Franklin Partnership in Washington, D.C. provides an update on a new trade case against Vietnam for undervaluing its currency. The latest action against Vietnam was announced October 2 by USTR to initiate a Section 301 investigation into currency manipulation as an illegal subsidy, which could result in tariffs on all Vietnamese imports similar to those imposed on China.

 

WTO EU Aviation Update

Sources in Washington, D.C. and Europe indicate that in the coming weeks the World Trade Organization (WTO) may authorize the European Union (EU) to impose up to $4 billion in tariffs on U.S. exports. This action is retaliation for U.S. federal and state governments providing illegal subsidies to Boeing over the years, which the WTO says violates international trade laws. Omar Nashashibi of the Franklin Partnership in Washington, D.C. discusses the potential impact of this development and the ongoing dispute over government subsidies to Boeing and Airbus.

 

WTO Report: United States Tariff Violation

On September 15, 2020, the World Trade Organization (WTO) released a report stating that the United States violated international trade laws when it imposed 7.5% and 25% tariffs on Chinese goods in 2018. Omar Nashashibi of the Franklin Partnership in Washington, D.C. discusses the ruling, how it does not mean an end to tariffs, and why it likely maintains the status quo on both sides.

 

Vietnam Currency Manipulation

On August 24, 2020, the U.S. Treasury Department determined that Vietnam is manipulating its currency, undervaluing it by roughly 4.7% against the U.S. dollar. Omar Nashashibi of the Franklin Partnership in Washington, D.C. discusses howjavascript:void(0); this designation will impact Vietnam imports, as well as imports from any country manipulating its currency that could now be subject to countervailing duties.

 

US European Mini-Deal

On August 21, 2020, the U.S. and European Union announced a slimmed down agreement to reduce tariffs on some European imports to the U.S. and to remove barriers to American lobster exports. Omar Nashashibi of the Franklin Partnership in Washington, D.C. discusses which products will see tariff relief and whether this is an opening for a thawing in the U.S.-EU trade wars. The U.S. and China have also resumed their review of the Phase I deal with sources in Washington indicating it is likely to hold at least through the election.

 
Boeing-Airbus Dispute: New Tariffs on EU Imports

On August 12, 2020, the U.S. Trade Representative released an updated list of European Union imports subject to 25% tariffs as part of the long-running Boeing-Airbus subsidy dispute. Omar Nashashibi of the Franklin Partnership in Washington, D.C. discusses the latest changes to the tariff list, what it means for impacted manufacturers and distributors, and the next review period to add or remove goods from the tariff list.

 

Reinstatement and Expansion of Aluminum Tariffs

On August 6, 2020, President Trump signed a proclamation announcing the imposition of 10 percent tariffs previously suspended on Canada in 2019 as part of the 2018 Section 232 investigation. Omar Nashashibi of the Franklin Partnership in Washington, D.C. discusses the reinstatement of the tariffs on unwrought non-alloyed aluminum, the expanded use of this Section 232 national security law which includes tariffs on transformers and their components, grain oriented electrical steel, and autos, and the need to watch not just the tariffs on Chinese imports, but those coming from other countries as well.

 

Importers face key deadline for tariff exclusions

Importers face a July 30 deadline to request an extension from paying the 7.5% tariffs on Chinese imports on List 4A on products already granted an exclusion. In the video below, Omar Nashashibi of the Franklin Partnership in Washington, D.C. discusses the importance of tracking these deadlines. Failing to file an extension request by the deadline could result in having the 25% tariff on Lists 1-3 or the 7.5% tariff on List 4A reinstated. A missed deadline could cost hundreds of thousands or millions in additional tariffs. Your CLA representative can help you track your exclusions and stay on top of upcoming deadlines.

 

Tariffs Announced on France Related to Digital Services Tax

On July 10, 2020, the U.S. Trade Representative announced a 25% tariff on $1.3 billion worth of French imports into the United States. This action, in response to France’s 3% digital services tax, is separate from the broader digital service tax (Section 301) dispute with the European Union, United Kingdom, India, and five other nations. Omar Nashashibi of the Franklin Partnership in Washington, D.C., discusses the new tariff threat, their suspension until January 2021, which French imports this action covers, and the broader trade dispute landscape with Europe.

 

USMCA replaces NAFTA

On July 1, the new U.S. Canada Mexico Agreement (USMCA) entered into force, replacing the 26-year old NAFTA. Omar Nashashibi of the Franklin Partnership in Washington, D.C. discusses the major updates to the Free Trade Agreement (FTA) and provides an overview of the new regional value content requirements, rules of origin, and changes to certificate of origin procedures.

 

U.S. Considers More Duties on EU Imports

On June 23, 2020, the Office of the U.S. Trade Representative requested public input on whether to continue imposing duties on imported goods from the European Union and whether to expand the list of goods subject to duties as part of the ongoing dispute between Boeing and Airbus. Omar Nashashibi of the Franklin Partnership in Washington, D.C., discusses which goods are currently subject to the 25 percent duties, reviews the already pending target list, and reveals the 30 goods from Germany, France, Spain, and the UK just added in Annex III. Importers from Europe are advised to contact their CLA representative to see how the current and pending actions could impact their operations.

 

Digital Service Taxes

On June 5, the United States Trade Representative (USTR) launched a Section 301 trade investigation into digital services taxes adopted or being considered by the European Union (EU), United Kingdom, India, Italy, Spain, and five other nations. Omar Nashashibi, of the Franklin Partnership in Washington, D.C., analyzes how the actions could lead to tariffs similar to those on France in 2019 and to those imposed on imports from China. The U.S. action is in response to efforts by the EU and other countries to impose a tax on revenue derived in their jurisdictions by firms such as Facebook, Amazon, Apple, and Google. The U.S. is accepting comments on their proposed action through July 15.

 

Trade Agreements:

Despite this year’s upcoming election or the COVID-19 pandemic, the U.S. is still very active on trade. Omar Nashashibi of The Franklin Partnership in Washington D.C., discusses the status of the U.S.-UK trade agreement, in addition to the talks between the U.S. and Kenya. Sources in Washington D.C. indicate both the U.S. and UK seek a comprehensive agreement with a timeline of having completed substantive talks by mid-August.

 

Hong Kong and Impact On China-U.S.

On May 29, 2020, President Trump announced he was taking steps to revoke the special status Hong Kong receives under U.S. law. The U.S. imposes low to no tariffs on goods from Hong Kong and they are not subject to the Section 301 25% and 7.5% tariff. Omar Nashashibi of the Franklin Partnership in Washington, D.C., discusses the steps the president has taken, China’s response, and what it means for tariffs moving forward.

 

A Potential Threat to the China Phase 1 Trade Agreement

Tensions between the U.S. and China are escalating again, just four months after President Trump signed the Phase I agreement in January. Omar Nashashibi of The Franklin Partnership in Washington, D.C., provides an update on the impact of the rising anti-China sentiment on trade and between the two countries. Through March 2020, under the Phase I agreement, China’s imports of covered manufactured products were $14.6 billion, compared with a year-to-date target of $27.7 billion. Meanwhile, Congress may include China-related trade provisions in the next COVID-19 legislation.

 

Chinese Import Exclusions

The Office of the U.S. Trade Representative is considering whether to grant a one year extension for 179 imported Chinese goods granted an exclusion last year. Omar Nashashibi of The Franklin Partnership in Washington, D.C. discusses the April 30th notice issued by the federal government requesting importers comment on whether to grant an extension for the exclusion. CLA clients with goods granted an exclusion on July 31, 2019 are advised to contact their CLA Representative to discuss the exclusion as it is set to expire on July 9, 2020. This video also discusses the rate at which exclusions are being approved with over 52,000 requests to not pay the China 301 tariffs filed.

 

Tariff Deferral Executive Order

On Sunday, April 19, the White House released an Executive Order the President signed on Saturday delaying for 90 days payments on duties imposed on select goods for importers suffering a significant financial hardship. Omar Nashashibi of The Franklin Partnership discusses this recent action and how it does not defer any tariffs on 301 China tariffs, 232 steel and aluminum tariffs or existing anti-dumping and countervailing duties. CLA has contracted with Franklin Partnership and Omar Nashashibi to provide the content for this video and audio series.

China Phase One Trade Deal Implementation

April 14 marked the two-month anniversary of entry into force of the U.S.-China Phase One trade deal signed by President Trump on January 15. Omar Nashashibi of The Franklin Partnership in Washington, D.C. provides an update post-implementation, the effects of COVID-19 on the deal, and specifically commitments by China to purchase an additional $200 billion in U.S. goods over the next two years. While China has missed deadlines on Intellectual Property theft and forced technology transfer, they are making progress and lifting restrictions on imports of some U.S. agricultural and energy exports.

 

President Not Deferring Tariff Payments 90 Days

Rumors spread throughout the nation’s capital and around the country as to whether, during the COVID-19 crisis, President Trump would defer payments on tariffs for 90 days. Omar Nashashibi of The Franklin Partnership in Washington, D.C., provides background on the rumors and how they proved false. At this time, the administration has no plans to suspend tariffs on China, Europe, or on steel and aluminum. The U.S. Trade Representative has, however, granted 38 exclusions for U.S. importers to bring in — tariff-free — certain medical devices and supplies from China. This video addresses the tariff rumors and the medical exclusions granted.

How is the Defense Production Act Being Used?

Many questions surround the Defense Production Act (DPA) and how it impacts manufacturers, distributors, and purchasers of medical device equipment. Established in 1950, the DPA authorizes the president to require businesses to accept and provide preferential treatment to government contracts. Omar Nashashibi of The Franklin Partnership in Washington, D.C., speaks to the cases in which President Trump has invoked the DPA, and shares that some purchasers of supplies and equipment are being redirected from businesses, hospitals, and the states to FEMA.

PPP Could Run Out of Funds – Will Congress Provide More?

Following unexpected demand, the Paycheck Protection Program (PPP) loan through the Small Business Administration, which began April 3, could be running out of funding. Omar Nashashibi of The Franklin Partnership in Washington, D.C., discusses reports from Capitol Hill that lawmakers may provide an additional $250 billion for the PPP, in addition to the $349 billion already appropriated. This video covers the likelihood of additional funding for PPP and what Phase 4 and Phase 5 of COVID-19 legislation could include, and when.

Small Business Administration Paycheck Protection Program

On March 31, the Small Business Administration (SBA) released its sample application for the Paycheck Protection Program (PPP) loan established in the recently passed CARES Act signed into law March 27, 2020. The PPP will use the SBA’s network of more than 1,800 certified lending institutions nationwide. Omar Nashashibi of The Franklin Partnership in Washington, D.C. previews the loan program available starting April 3 to businesses with fewer than 500 employees. The loan matures in two years at a 0.5% interest rate, with payments deferred for six months. The Department of Treasury posted information sheets for borrowers and lenders, explaining that the lender may forgive portions of the loan.

Phase 3 COVID-19 Stimulus Package

The United States Congress has passed its third installation of COVID-19/Coronavirus response packages. A fourth could possibly come in April. Omar Nashashibi of The Franklin Partnership in Washington, D.C. provides an overview of what is included for businesses and individuals. From creating a $500 billion loan package to expanding low interest loans to small businesses, this $2 trillion Phase 3 COVID-19 bill is the largest stimulus in U.S. history and impacts virtually every corner of the economy.

Definition of an Essential Business

Roughly half of the United States is currently under stay-at-home orders at the city, county or state level. Omar Nashashibi of The Franklin Partnership in Washington, D.C. discusses who determines which businesses may remain open. What is an essential business? Where can you go to find out whether you can continue operations? States and counties are making these decisions, but the federal government has started to provide guidance. As more states impose stay-at-home directives, this video will help you find the information you need to comply with the orders.

COVID-19 Phase 2 Bill and Stimulus

On March 18, the U.S. Senate requested a signature from President Trump for the Families First Coronavirus Response Act after the House passed its revised version on March 16. Omar Nashashibi of Franklin Partnership provides an overview of what’s included in the bill and the prospects for a Phase 3 economic stimulus measure to support the economy during the COVID-19 disruptions. This video highlights the paid sick leave and FMLA provisions included in the Phase 2 law and the proposals put forward by the White House to support airlines, small businesses, and other sectors and individuals.

The European Travel Ban and COVID-19’s Impact on Trad

On March 11, the White House issued a Presidential Proclamation restricting travel from 26 European nations. Omar Nashashibi of Franklin Partnership provides an overview of the new travel ban, effective 11:59 p.m. on March 13, 2020, and who it covers. Additionally, Nashashibi addresses the broader impact of COVID-19 on trade with Europe and China and potential domestic economic disruptions ahead, along with U.S. government response. We will continue to bring you the latest updates on business-related news and the impacts of the coronavirus.

Contact us if you have questions related to the impacts the coronavirus may have on your business.

The Economic Impacts of Coronavirus

Reports of disruptions to manufacturing, distribution, and retail resulting from the Coronavirus continue to grow. Omar Nashashibi of Franklin Partnership discusses what he is hearing from his contacts and clients about the latest in China including whether workers are returning to their jobs, and ongoing and expected delivery delays. Connect with your CLA representative to be proactive in the potential economic impacts of Coronavirus. We can help you explore alternative suppliers and ways to mitigate disruptions to operations.

New EU Tariffs and Their Impact on Trade

On February 14, 2020, President Trump reaffirmed the 25 percent tariffs in place on hundreds of European Union imports from wine and cheese to power tools and clothing. Omar Nashashibi of Franklin Partnership discusses the latest with the years long aviation dispute concerning government subsidies to Boeing and Airbus. We understand you may have no choice but to import from Europe, so it is important to explore possible alternatives as trade disputes continue. Our CLA professionals can help you identify the best option for you moving forward.

A New Trade Agreement to Lower Tensions Between the U.S. and China

On January 15, 2020, President Trump and Vice Premier Liu He signed a ninety page Phase I agreement in an effort to lower tensions between the world’s two largest economies. In this video Omar Nashashibi of Franklin Partnership explains what is in the agreement, what it means for U.S. businesses, and what are the next steps in the U.S.-China trade wars.

  

How we can help

CLA’s manufacturing and distribution professionals and international business advisors can help you assess the impact of tariffs on your operations and craft short- and long-term strategies for competing amid the trade war.

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