Future opportunities with Trump tariffs

THE EDITOR: So I recently saw an article that sanitary pads will now be more expensive because of US President Donald Trump’s 145 per cent tariff on China imports. Why will they be more expensive for Trinidad? Because even though imported from China, the items pass through the US and therefore will be subject to US tariffs.

The importing company stated that they were trying to not pass on the cost but may have to cut imports because of the cost. What confused me was there was no thought of buying directly from China or shipping via another country like Mexico or Panama.

I know contracts and agreements are factors, but a contract is not a suicide pact, as the Americans say.

If we Trinidadians and Tobagonians are going to survive the next four years, then everyone – government, big business, small business, private citizens – is going to have to become more flexible, more imaginative and more daring.

The world is changing and changing fast. By the time this letter is published events may have moved even further. Tariffs are going up between the major entities – the US, China and even the EU. Trade relations are being severed.

China has simply cut beef and soya imports from the US and redirected towards Brazil and Australia. China is flooding social media, advertising direct purchases from Chinese factories without going through US and European distributors. Trump's 145 per cent tariff is being applied to any Chinese product passing through the US.

These are not temporary measures. Trump will be in power till January 2029 at least. And who knows who will succeed him.

Further from his very recent negotiations with Israel, Vietnam and the EU, we know what negotiations with Trump look like.

1. Importing third-party countries would have to remove custom duties and VAT from US products, which taken together would lead to US products being cheaper than domestic products.

2. Third-party countries would have to raise tariffs on China to the same level as the US, essentially cutting off trade with China.

3. But the US still gets to keep tariffs on the third-party country.

Hopefully whichever party forms the next government is aware of this and plans accordingly. Trade relations and supply chains are in flux. Clinging to pre-Trump agreements will see us left behind.

The April 28 winner must take an active and forward-thinking role. Trying to save the status quo will not work because it no longer exists. We cannot be conservative and laid back at this moment.

As a further example, last year Trump mused about devaluing the US dollar to increase US exports, and right now the dollar is in decline. TT should reconsider what it means to maintain our dirty float tying us to the US dollar. What is the best option for us in a world where the US dollar is falling but the euro is not? We need to recalibrate, and such a decision has to be made for the benefit of the nation.

But all is not negative, as change brings about opportunity and there will opportunities for TT as trade and manufacturing shift around the world in the next few years.

TT has every possibility of increasing its viability as a trade and logistic hub, as an importer and re-exporter, and as a site for manufacturing. We must be of a mindset where we want to take advantage of these changes and not simply lay back and let events happen to us.

EMILE ENIGHTOOLA

via e-mail