By Randall Yip | AsAm News
News of a 125% tariff on China implemented today by President Trump is hitting Chinatown merchants hard across the country.
Lucas Li of Lion Trading in San Francisco imports 100% of his merchandise from China. He sells cultural products that appeal to his mostly Chinese American customer base.
“I thought that it couldn’t get worse, honestly,” he said in an exasperated voice to AsAmNews. “I think this tariff is going to have a huge impact on our business.”
Just last month, Trump announced he would impose a 20% tariff on China. That increased to 54% on April 2.
Within days, China announced it would retaliate with its own tax of 34% on American imports. Trump then raised the tariff on Chinese imports to 104%. That increased by more than two times the cost of importing goods for small businesses such as Lion Trading.
With the tariff war showing no signs of letting up, and China announcing this morning it would hike its tariff on American goods to 84%, Chinatown small businesses are feeling numb.
“As this administration moves forward day-to-day, moving the goalposts, I have merchants literally like they don’t know what to do,” said David Ho, consultant to the Chinese Chamber of Commerce in San Francisco. “I think everyone is stunned.”
He says merchants must decide whether they are going to sell fewer imported products, raise the price or eat the costs.
Ho anticipates those who supported Trump in the last election may begin second guessing their vote.
“It’s the economy, right?” he said matter of factly.
Merchants fear customers already feeling the pinch from higher prices at the grocery store are likely to decrease their spending.
“Being so expensive, I think that a lot of the customers will really cut down,” said Li. “They’re feeling a little bit numb and kind of feel it’s not something that they can control.”
He plans to work with his distributors to see if they would be willing to lower their prices. He will also look into how much of the higher costs he can just eat but anticipates it will be necessary for him to raise his prices 50%.
“I think definitely small businesses like us definitely got in the crossfire of the Tariff war and these tariffs are not easy for us.”
Randall Yip is Executive Editor of AsAm News.
Update: As of Wednesday, April 9 the Trump Administration announced a 90 day pause on reciprocal tariffs for all countries excluding China, where tariffs on imported goods stand at 125%. Beijing this week slapped an 84% tariff on US goods.
