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Trade & Tariffs

What the U.S.-China trade deal means for outdoor businesses

The first set of tariff cancellations and rollbacks is a "small step forward," Outdoor Industry Association says.

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Last week, President Donald Trump shared welcome news on Twitter: The U.S. and China reached the first phase of a trade deal and is forging ahead on a second phase.

Because of the negotiations, a 15 percent tariff on outdoor apparel, footwear, and equipment on List 4B slated for Dec. 15 was cancelled. Additionally, a 15 percent tariffs on List 4A products was cut in half to 7.5 percent.

“While the rollback of the List 4A tariffs and the cancellation of the List 4B tariffs are welcome news for outdoor businesses, more is needed to give America’s outdoor businesses a stable economic environment,” Outdoor Industry Association (OIA) Manager of International Trade Rich Harper wrote in an email. “The fact remains that outdoor companies have already paid $2.6 billion more in tariffs on affected products over the past year due to the U.S.-China trade war.”

The 25 percent tariffs on List 3—$250 billion worth of products including backpacks, sports bags, camp chairs, bikes, and leather gloves—will remain unless they’re cancelled during phase two negotiations.

“The administration should lift all punitive tariffs now so outdoor companies can stop paying billions in new taxes and can get back to doing what they do best: developing new innovative outdoor gear to enhance the outdoor experience,” Harper said.

On Dec. 11, OIA signed a letter from Americans for Free Trade, a coalition of more than 150 associations from every industry, urging Trump and the administration to suspend the 4B tariffs. Trump announced the trade deal on Dec. 12.

“The decision to cancel the List 4B tariffs and the announcement that the Phase One deal will cut some tariffs already in place is a small step forward,” Americans for Free Trade wrote in response to the deal. “However, the tariffs still in place are a tax that Americans—and not China— continue to pay, to the tune of tens of billions of dollars. And by only reducing the tariffs on a few items, the administration is picking winners and losers in this trade war. In the month of October alone, Americans paid almost $2.7 billion in additional taxes because of the tariffs on Lists One through Three. That’s why we urge the administration to continue to work diligently to come to a final agreement with China that will remove all of the tariffs currently in place.”

Other terms of the trade deal include China’s cancellation of retaliatory tariffs set to take effect on Dec. 15, China agreeing to buy more American products and services by at least $200 billion over the next two years, and stronger Chinese legal protections on intellectual property—what started the tit-for-tat tariffs in the first place.

Stay tuned for phase two terms.