U.S. Will Not Slap Vietnam Imports with New Tariffs
The Office of the U.S. Trade Representative (USTR) announced late last week that it would not place new tariffs on Vietnam imports. The decision came after a nine-month investigation prompted by the Trump Administration that labeled the Asian nation and sixth largest importer to U.S. “a currency manipulator.” Initial USTR scrutiny last fall found that Vietnam intervened in foreign exchange markets to place an unreasonable burden on U.S. commerce, but a subsequent investigation by the U.S. Treasury Dept. did not concur.
That result means the U.S. will not initiate Section 301 Tariffs of up to 25 percent on Vietnam imports, including footwear. Approximately 25 percent of all shoes imported into the U.S. and 51 percent of athletic shoes brought into the region are sourced in Vietnam, according to the Footwear Distributors and Retailers of America (FDRA). The country is also a major exporter of apparel, electronics and furniture to the U.S.
Sports & Fitness Industry Association (SFIA) President and CEO Tom Cove called the “no trade action” decision by the U.S. concerning Vietnam “a huge relief for our industry.
“At a time when almost every one of our member companies is scrambling to address multiple supply chain challenges, it is good news to take cost increases from potential new tariffs off the table,” said Cove. “We are grateful to the (Biden) Administration for listening to our concerns.”
The U.S. Treasury and State Bank of Vietnam have an agreement to resolve any currency issues, and the USTR and U.S. Treasury will monitor implementation of Vietnam’s obligations under it.