The president’s tariffs are driving some manufacturing out of China, but much of it remains outside of the United States. Instead, a number of other countries are benefiting from Trump’s trade war, according to data released by the Census Bureau on Thursday.
US imports from Vietnam are up 38% during the first four months of 2019. This suggests that US importers are finding ways to buy from suppliers there. Imports have also increased by 22% from Taiwan, 17% from South Korea, and 13% from Bangladesh, the government data shows.
Americans are importing about 12% less from China,a shift that comes after a year of inconclusive trade negotiations.
Trump has recently expanded his trade war to include Mexico, which he’s threatened with 5% tariffs starting on Monday.
The President has continually claimed that his tariffs will prompt manufacturers to bring production back to the US, a core campaign promise.
“The higher the Tariffs go, the higher the number of companies that will move back to the USA!,” he tweeted this week.
“Also, the Tariffs can be completely avoided if you buy from a non-Tariffed Country, or you buy the product inside the USA (the best idea). That’s Zero Tariffs. Many Tariffed companies will be leaving China for Vietnam and other such countries in Asia. That’s why China wants to make a deal so badly!” Trump tweeted last month.
Many US importers rely heavily on China for goods and component pieces. In some cases, the US doesn’t have the factories to produce what’s needed. Plus, wages are higher and the US labor market is tight.
“There is a litany of countries that footwear companies will consider before coming to the United States,” said Matt Priest, president and CEO of the Footwear Distributors and Retailers of America, adding, “The United States is really not an option.”
But other countries are. Footwear companies will likely first look to shift production to Vietnam, where some shoe manufacturing already exists and it’s easy to bring Chinese materials across the border, Priest said.
“I think this notion that everything has to be made here is ignoring the economic facts of the 21st century global supply chain,” he said.