Los Angeles, Apr 5 (UNI) Tariffs could lead to a 10 per cent drop in cargo volume moving through the Port of Los Angeles later this year, the U.S. largest port's Executive Director Gene Seroka warned Friday.
"We need lumber from Canada; appliances from Mexico; aluminium, steel, copper and furniture from China," Seroka explained in an interview with Politico, an American political digital newspaper.
"All of those commodities and more were hit with the highest tax we've ever seen in yesterday's announcement," he lamented, "Any slowdown at the ports would reach deep into the L.A.-area economy."
"It's my view that the second half of this year ... we're going to start to see a drop in cargo. The drop, I think, is going to be at least 10 percent at the nation's largest port here in Los Angeles," he said.
On Wednesday, U.S. President Donald Trump announced a new set of levies, imposing a 10 percent baseline tariff on all imports starting on April 5 and slapping individualised reciprocal higher rates on those trading partners with which the United States "has the largest trade deficits," which will kick in on April 9.
The tariffs included additional duties of 24 percent on Japan, 25 percent on South Korea and 34 percent on China. Additionally, China's new tariff was imposed on top of a 20 percent tariff that Trump imposed on China over the so-called fentanyl issue. That escalated U.S. tariffs on China to a crippling 54 percent.
Trump's campaign plan to increase tariffs has triggered a buying frenzy of vendors trying to ship in their international goods before the tariffs hit. So the twin ports of Los Angeles and Long Beach set records for cargo traffic in November as companies loaded up on goods in anticipation of the tariffs.
That rush was over, and available goods would begin to dramatically decrease as shipping slows down and fewer goods are available – or affordable. Many business insiders predicted after Trump's announcement Wednesday, noting that any slowdown at the busiest ports in the country would reach deep into the L.A.-area economy and beyond into the rest of the country.
The trade, transportation, and utilities sector is one of L.A. County's largest employment clusters, employing an estimated 830,000 workers last year, according to a report by the Los Angeles County Economic Development.
"There will be fewer employment opportunities at the ports and throughout the supply chain that goes from the ports well into the Inland Empire, where huge numbers of containers are processed each day," said economist Jock O'Connell, an international trade advisor at Los Angeles's Beacon Economics.
"You'll see folks that have to scramble pretty quickly to keep their jobs and keep food on the table," Seroka said Friday. "It's going to be disruptive."
Disgruntled L.A. resident Michael T. told Xinhua on Friday that he believed Trump's measure was a bad one.
"Tariff fees sound compelling, but they don't tell you those fees are just passed on to the American consumer as price increases at the store," he said, "that money comes out of our pockets, not Trump's, not China's. When everything costs more, everyone buys less, and that's going to tank the U.S. economy."
UNI XINHUA ARN