Trump suspends some Chinese tariffs, but Shein and Temu things will remain expensive
Made in the United States and China on Monday Joint Statement The announcement of a new phase in the trade war temporarily suspended the tariffs imposed by the two countries earlier this year. In the next 90 days, China will reduce tariffs on U.S. imports, from 125% to 10%. In the same time frame, the United States will reduce tariffs on Chinese imports from 145% to 30%. However, what is excluded from this transaction is that Chinese goods are worth less than $800 and will be taxed at a 120% rate, or a uniform tax rate $100 per postal item. Starting June 1, the $100 fee will double to $200.
The joint statement comes after officials from both countries met in Geneva over the weekend. The news broke out Monday morning since President Trump's “liberation day”, and market volatility increased as news broke.
Last month, President Trump announced various new tariffs on global imports, including 84% of his duties Regarding China's imports, it then rose to 145%. He also closed the “minimum” vulnerability, which was previously tax-free from China and was worth less than $800. President Trump claims he is closing the loopholes to help combat the synthetic opioid crisis in the United States. In the fact sheet issued by the White House, Trump administrators claimed that “many” of Chinese shippers have used the minimum exemption to “hide illegal packages, including synthetic opioids, in low-value packages.”
Despite the Trump administration's emphasis on synthetic opioids, many of the public conversations ending with this exemption are about cheap sneakers, memory foam pillows, and drones sold by Chinese e-commerce giants such as Shein and Temu.
Both companies benefited greatly from the minimum exemption and said they planned to raise prices in light of the changes. In a separate but same statement, Shein and Temu said: “Our operating expenses have risen due to the latest changes in global trade rules and tariffs. To continue to provide products you like without damaging the quality, we will make a price adjustment starting April 25, 2025.”
However, in early May, Temu seemed to have changed the process. Fashion diving Temu will address tariffs by transitioning to a local distribution model and hire suppliers in the United States. While the strategy helped the company circumvent Trump’s tariffs, it allowed Temu to compete directly with Amazon and Walmart in the United States. Last year, Amazon seemed to notice Temu and Shein are becoming more and more popular in the United States by launching its own discount platform, Amazon Haul. In the second half of last month, President Donald Trump called Amazon's executive chairman Jeff Bezos, saying Amazon's operations will show import fees on its site. Despite the idea being discussed internally, Amazon said in a statement to NBC News: “It has never been approved and will not happen.”
In March, American retailer Forever21 (fast fashion stalwart) filed for the second time. Forever21 said in court documents that Shein and Temu's use of De Minimis exceptions was “substantial and negatively impacted” and accused them of “weaking” Forever21's business.
While winners and losers will remain to be seen in Trump’s reshaping trade landscape, it’s hard not to stick to the hope that American consumers may consider reevaluating their endless appetite for more and cheaper things.
