The US under the Trumpian administration has begun implementing new tariffs on small packages from everywhere in the world, closing a loophole that has allowed billions of dollars of goods to enter the country duty-free. A tariff waiver that allowed goods worth less than $800 to enter the US duty-free is now gone, and all packages entering the country will now be subject to tariffs regardless of their value. This for sure has a huge implication for China which has been sending, it says here, over a billion packages a year to the US. That is big companies, but also small traders, cottage industry players who have lived off small-scale Amazon trades, SHEIN clothes, Temu and other platforms, not to mention any other items being shipped by individuals or companies. What proportion of that billion packages is no longer worth sending?
Reconstructing the whole trade relationship between China and the United States, between China and the world come to that, is clearly overdue. WTO has become irrelevant it seems. There is now no framework that works in terms of working out trading issues like this in any sensible way. But maybe the Trumpian chaos will help create a solution. Wishful thinking? We will see.
Have a great weekend.