Blog: Leonie BarrieMexico tariff move "unfathomable" and "concerning"

Leonie Barrie | 3 June 2019

In a surprise move late last week, the US announced new tariffs on all imports from Mexico – starting next Monday (10 June). The tariffs are in response to the flow of migrants crossing from Mexico into America, and will begin at 5%, rising to 25% by 1 October. Groups representing companies across the entire US apparel, footwear and textile supply chain have criticised the decision as "unfathomable."

The new tariffs come hot on the heels of the escalating US trade war with China – which represents a significant readjustment of trade relations between the two countries, according to Robert Antoshak. Get used to it, he says, in his monthly column on just-style.

The CEO of Columbia Sportswear has called the US-China trade war "very disruptive to business," adding it is forcing apparel and footwear brands to spend more time managing their sourcing operations instead of selling.

And US specialty apparel retailer Gap Inc has started its fiscal year with a 4% fall in comparable sales, dragged down by a 10% decline at Gap stores – and says it is actively monitoring the proposed new US tariffs on clothing manufactured in China.

Vietnam, meanwhile, is seeking to boost fabric production so that its domestic garment makers can prosper from the "yarn-forward" rules of origin under the CPTPP trade deal.

And the United States has terminated Turkey's designation as a beneficiary developing country under the Generalized System of Preferences (GSP) programme – eliminating the eligibility of thousands of imports for duty-free treatment.

A group representing US apparel retailers, brands and importers has warned that growth in Bangladesh's ready-made garment industry is threatened by the government's response to this year's minimum wage protests and a wavering commitment to the future of worker safety.

And a global campaign has been launched on behalf of Cambodian workers who are concerned they will lose their jobs if the EU proceeds with threats to pull Cambodia's access to the Everything But Arms duty-free trade benefit.

Despite high levels of economic growth and improvements on poverty and education, progress on child labour has stalled in the manufacturing countries most entwined with global apparel supply chains, new research has shown. Key manufacturing hubs – including China, India, Bangladesh, Vietnam and Cambodia – have registered no tangible improvement in a ranking of 198 countries since 2016.

While it is easy to find brands that claim to be eco-friendly or are produced in a sustainable way, what are the top sellers, products and pricing strategies? We’ve done some number crunching to find out.

Transparency is also good for business, from winning over consumers to gaining more investor approval. Here’s how.

In other news, VF Corp’s long-standing supply chain chief Tom Glaser is leaving to take up the post of chief operations officer at luxury specialist Tapestry; the Sustainable Apparel Coalition (SAC) is to lead an industry-wide effort to push for EU circular policy change; and global logistics specialist Maersk has invested $1.7m in a fashion supply chain tech-startup.

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