Vietnam and Malaysia could be among the winners from an all-encompassing tariff on Chinese furniture imports proposed by US president Donald Trump.
While most of the media focus on the Trump tariffs has centred on the aluminium, steel, motor vehicle and electronic goods sectors, some of the most wide-ranging restrictions look set to be imposed on the humble furniture industry.
Plans released last week by the White House to expand tariffs to an additional $200bn of Chinese imports, on top of the $50bn already unveiled, would hit every category of furniture.
This stands in stark contrast to areas such as electronics, where the likes of printed circuit boards and routers are covered by the proposed tariff regime, but mobile phones and tablets are not. Moreover toys, footwear and apparel are exempted entirely, as the first chart shows.
China dominates US furniture imports, with 50.9 per cent share of the sector’s $63bn imports last year, according to data from the US International Trade Commission.
Its annual furniture exports to the US have jumped from $2.4bn in 1996 to $31.9bn last year, far exceeding the fivefold increase in the value of US furniture imports over the period. Mexico and Canada are the next biggest exporters, with sales of $10.8bn and $4.8bn respectively in 2017, as depicted in the second chart.
However, Thomas Costerg, senior US economist at Pictet Wealth Management, doubted whether either of the US’s neighbours was well placed to pick up market share if Chinese goods were rendered uncompetitive by the tariffs.