U.S. shoemakers face losses amid China, U.S. trade tension

Jeck Deocampo   •   September 18, 2019   •   389

Shoemakers in the United States are facing losses over the tit-for-tat tariffs amid the trade tension between China and the U.S.

Xero Shoes is an American brand of lightweight minimalist footwear designed for walking, running and athletics. According to Steven Sashen, CEO of the company, their shoes and sandals have thin and flexible soles that are contoured to the shape of the human foot.

“It really reflects the essence of what we’re doing, which is something so lightweight, so minimalist, so barely there that you don’t know that it exists,” said Sashen.

Sashen started the company with his wife Lena Phoenix 10 years ago. Their 80-percent online business has taken off with 84-percent growth in the past four years.

Yet as another round of U.S. tariff took effect from early September, Sashen’s products are now 15 percent more expensive to import from China, where all of his shoes are made.

Lena Phoenix, co-founder of Xero Shoes, says one possible solution is to uproot their supply chain. Yet such move would take time and it isn’t as easy as it sounds.

“We don’t want to leave China. Moving factories is very dangerous for a company of our size,” said Phoenix.

“People just say very casually: well why don’t you move to Vietnam for example? Well, cause Vietnam is full. They’re overcapacity already,” said Sashen.

They’ve also thought about raising shoe prices in response to the tariff.

“While we have a rabid fan base and many people say we’re happy to pay a few dollars more. That’s what people love to say, but when push comes to shove, people are very price-conscious,” said Sashen.

“We’re going to hold prices as long as we can,” said Phoenix.

Sashen and Phoenix are not the only ones facing such dilemma. Xero joined forces with about 200 other footwear companies to write to President Trump last month, urging him to cancel the newly planned additional tariffs on goods imported from China.

The letter points out that the tariffs on footwear products imported from China are already at a high level of 11 percent on average, and will reach 67 percent on some shoes after the new tariffs take effect.

According to the letter, the 15 percent tariff will cost U.S. shoe consumers an additional four billion U.S. dollars every year, which may create further economic uncertainty.

“It’s almost impossible to come up with a coherent strategy because of how in flux all of this is,” said Sashen.

Xero is now trying to come up with a long-range manufacturing plan.

“It forces you to step out of your comfort zone and be innovative and thoughtful about how to go forward long-term,” said Michael Wellman, the vice president of the company’s Asia Pacific Development.

Meanwhile, the shoe-makers are also hoping for near-term relief for the footwear industry, which was relatively highly taxed even before the trade war picked up speed.

“There’s a part of me that’s still in denial, that hopes that it’s going to be resolved next month,” said Phoenix. (REUTERS)

China warns of consequences if UK offers residency to HK citizens

UNTV News   •   July 2, 2020

China’s foreign ministry said on Thursday (July 2) that Britain would bear all consequences for any move it took to offer Hong Kong citizens a path to settlement in the UK.

China reserved the right to act against Britain over the issue, foreign ministry spokesman Zhao Lijian told a daily briefing, without specifying what countermeasures Beijing might take.

British Prime Minister Boris Johnson said on Wednesday (July 1) that China’s imposition of a security law on Hong Kong was a “clear and serious” violation of the 1984 Joint Declaration and that Britain would offer around 3 million residents of the former colony a path to British citizenship. (Reuters)

(Production: Joseph Campbell, Wang Shubing)

UK says China’s security law is “clear violation” of Hong Kong treaty

UNTV News   •   July 2, 2020

The United Kingdom said on Wednesday (July 1) that China’s imposition of a security law on Hong Kong was a “clear and serious” violation of the 1984 Joint Declaration and called on the People’s Republic to honor its international obligations.

“We have very carefully now assessed the contents of this national security legislation since it was published last night,” Foreign Secretary Dominic Raab told Reuters and the BBC.

“It constitutes a clear violation of the autonomy of Hong Kong, and a direct threat to the freedoms of its people, and therefore I’m afraid to say it is a clear and serious violation of the Joint Declaration treaty between the United Kingdom and China.”

Raab said he would set out shortly the action Britain would take with its international partners.

Hong Kong’s autonomy was guaranteed under the “one country, two systems” agreement enshrined in the Sino-British Joint Declaration signed by then Chinese Premier Zhao Ziyang and British Prime Minister Margaret Thatcher.

Hong Kong was handed back to China in 1997 after more than 150 years of British rule – imposed after Britain defeated China in the First Opium War. (Reuters)

(Production: Will Russell, Hanna Rantala, Polly Rider)

Hong Kong marks handover anniversary as national security law takes effect

UNTV News   •   July 1, 2020

Hong Kong on Wednesday (July 1) held a flag-raising ceremony followed by a speech by Chief Executive Carrie Lam to mark the 23rd anniversary of the former British colony’s handover to Chinese rule, hours after new national security legislation took effect in the financial hub.

“The enactment of the national law is regarded as the most significant development in the relationship between the Central Authorities and the HKSAR since Hong Kong’s return to the Motherland”, the city’s embattled leader said the law was the most important development since the city’s return to Beijing in 1997.

Flanked by current and previous government officials, Lam also said the new law would only affect a small group of people in the Asian financial capital.

There was a heavy presence of law enforcement across the city as the ceremony was underway.

The contentious law will punish crimes of secession, subversion, terrorism and collusion with foreign forces with up to life in prison, heralding a more authoritarian era for China’s freest city.

Authorities in Beijing and Hong Kong have repeatedly said the legislation is aimed at a few “troublemakers” and will not affect rights and freedoms, nor investor interests. (Reuters)

(Production: Aleksander Solum)

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