Hong Kong businesses impacted by the US tariffs on US$250 billion in Chinese goods have “no easy fix” but could consider several strategies to minimise their exposure, according to a former US trade official.
Actions that are less drastic than disrupting entire supply chains or shifting markets, but involve scrutinising how goods are classified and valued, could help some companies reduce duties, Washington-based lawyer and former member of the Office of the United States Trade Representative Andrew Shoyer said.
But such changes require careful consideration, as scrutiny of US customs declarations has risen alongside tariffs and tightening trade regulation globally, according to trade law experts.
“There is a distinct possibility, regardless of the outcome of the current Sino-US negotiation, that the US will retain tariffs on at least the [first] US$50 billion in imports of Chinese goods,” Shoyer said, speaking at a Hong Kong Trade Development Council event last week.
“For Hong Kong exporters and companies there is no easy fix; it would be easy for me to say, ‘stop exporting from China’, but that’s not the reality,” Shoyer said.
Instead, the lawyer suggests companies can try working with their US importers to seek a tariff exemption from the US government, a process which requires proving a good is not available elsewhere and that its absence would harm American consumers.
Other strategies include reassessing the customs valuation of a product, as total duties owed are calculated based on how much a product is worth, or considering whether it is possible to change a product’s declared country of origin, by proving it has been substantively changed into its final form in a country other than China, Shoyer said.
