Yahoo Finance Fashion Dodges New Tariffs on Vietnam After Currency Investigation
U.S. Trade Representative Robert Lighthizer opted for a warning rather than a new round of tariffs against Vietnam.
That caused a sigh of relief in fashion in the waning days of President Donald Trump’s administration.
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Trump always seemed ready for a trade fight and cracked down on China with steep tariffs that still make clothing from factories there more expensive. That helped push many brands to Vietnam, only to find that country in the crosshairs soon afterward.
Vietnam was being investigated for allegedly undervaluing its currency, but that process was wrapped up on Friday without any specific actions.
Lighthizer said: “Unfair acts, policies and practices that contribute to currency undervaluation harm U.S. workers and businesses, and need to be addressed. I hope that the United States and Vietnam can find a path for addressing our concerns.”
A similar investigation into Vietnam’s practices in the timber industry is pending.
The fashion importing world has worried that the Trump administration would impose punitive tariffs on Vietnam just before the inauguration and that those new duties could stick for at least a time while the administration of President-elect Joseph Biden gets settled. But there’s a lot going on — from the pandemic to Trump’s second impeachment — and last-minute levies on Vietnam would not likely be at the top of the list. Biden’s pick for trade rep, Katherine Tai, could also have chosen to keep the tariffs.
For the on-edge fashion industry, every nickel counts right now.
“There is never a good time for tariffs, but they would be particularly harmful as all Americans and this industry continue to be impacted by the effects of COVID-19,” said Stephen Lamar, president and chief executive officer of the American Apparel & Footwear Association. “Tariffs are taxes on American consumers, American workers, and American companies. This has become abundantly clear during the U.S.-China trade war. Vietnam is an important trading partner, especially as businesses try to rebalance their sourcing away from China. Adding tariffs to imports from Vietnam would hurt those efforts and investments.”
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