Trade association chief warns US days away from 'retail Armageddon'
With the latest round of tariffs on a wide swath of goods from China set to hit Sunday, the head of a major trade association representing the apparel and footwear industry is warning the United States is fast approaching “retail Armageddon.”
“If we get hit with these tariffs, this is a one way ticket to retail ugly,” Rick Helfenbein, CEO of the American Apparel & Footwear Association, told Fox Business.
Beginning Sept. 1, the Trump administration will slap 15% tariffs on $300 billion in products imported from China. The duties scheduled to take effect in the coming days will hit 92% of apparel and 53% of footwear imported from China.
The goods were initially supposed to be taxed at 10%, but President Trump hiked the tariffs after Beijing announced it would impose its own retaliatory duties on $75 billion in U.S. products. A second round of levies set to go into effect Dec. 15 will also be hit with a 15% tax and will affect $51 billion in apparel, footwear, and textile products.
The president’s decision to bump up the tariffs on Chinese imports marked the latest escalation in his protracted trade war with Beijing, though Trump said this week at the G-7 in Biarritz, France, representatives from the world’s two largest economies would return to the negotiating table to discuss a trade deal.
The tariffs on the $300 billion in goods from China were supposed to take effect Sept. 1, but Trump delayed some of the duties until mid-December in an effort to protect American consumers during the busy holiday shopping season.
Helfenbein, however, urged the Trump administration to pull back on the levies or risk ruining the holidays.
“We know the president loves Christmas, we know it, and we hope he doesn’t want his administration to be the Grinch,” he said. “We don’t make that much money and 15% is going to take away the profits of retailers.”
While some retailers are going to attempt to absorb the cost of the tariffs, Helfenbein said at a certain point, the tax will be passed on to consumers.
“The president could walk out of this being a major hero, but only if it gets resolved,” he said. “If it doesn’t get resolved, my folks can’t pay for it and the American consumer can’t pay for it. This is really a bad deal.”