By  on June 4, 2018

President Donald Trump took to Twitter — where else? — to mark 500 days in office on Monday, touting accomplishments such as “Massive Tax & Regulation Cuts” and “Best Economy & Jobs EVER.”He also bashed China and Canada on trade, specifically taking them to task for barriers applying to U.S. agricultural products that are “not acceptable!”“The U.S. has made such bad trade deals over so many years that we can only WIN!” he said.But fashion brands, retailers and the lobbyists who represent them are growing increasingly worried. Trying to win, at least the way Trump envisions, feels a lot more like losing since the president’s bombastic and unorthodox approach has created such an unsteady environment.Trump has laid out $50 billion in tariffs against Chinese imports and threatened another $100 billion should the country respond in kind.Jessica Fortier, vice president of Gap Inc.’s contact center and supply chain strategy and transformation, recently wrote to Trump’s U.S. Trade Representative Robert Lighthizer, noting the retailer already pays more than $600 million in tariffs each year.“Gap Inc. has plans to invest more than $400 million in U.S. inventory and fulfillment infrastructure and create over 3,000 U.S. jobs over the next few years to support our U.S. market growth,” she said. “At a time when unemployment is falling and economic growth is strong, we urge the Administration to continue to avoid tariffs on consumer products, particularly apparel.”But many experts believe that while the first $50 billion in tariffs missed apparel (but did hit machinery needed to make it for any Made in USA effort) the $100 billion in follow-up duties would likely include fashion.And that’s just one front in Trump’s trade war. The administration also imposed tariffs on certain metals from the European Union, drawing tit-for-tat action with a proposal for a 25 percent tariff on U.S.-made jeans and other items.Asked if there was a method in the madness of the approach, David French, senior vice president of government relations at the National Retail Federation, said, “I hope so, but I’m not sure I see it yet.”“By picking fights with our allies as well as our adversaries, we have introduced a lot of uncertainty,” French said. “Apparel retailers right now are trying to assess the risk and they’re starting to look at places they can shift their sourcing to.”But the adjustments they can make are limited. “You can’t just move the supply chain next week,” he said.All the noise on the trade front comes on the heels of a tax reform package retailers loudly applauded.“Corporate tax reform was very important,” said Hun Quach, vice president of international trade at the Retail Industry Leaders Association. “The uncertainty related to tariffs, the president’s plan for raising tariffs on U.S. imports…have the ability to wipe out a lot of those gains.”There are also worries that China could make its displeasure known in other ways that could impact companies in other ways.“China is very strategic when it comes to their economic situation,” Quach said. “When they’re put under pressure, they find ways to retaliate.”The practice of making sudden changes in trade policy is a new approach in a world that tends to move at glacial speeds and was bound by broad multinational agreements designed to provide stability.“Now you’ve got this kind of on-again, off-again environment where no one really knows how the week is going to end,” said Stephen Lamar, executive vice president of the American Apparel & Footwear Association.“People are worried about the other shoe dropping,” Lamar said. “The biggest danger is if the China issue spins out of control.”And he noted that, before Trump came to town, there were plenty of concerns in the U.S.-China trade relationship, including in the areas of intellectual property and market access, that still need to be addressed.“We don’t have any hope of fixing any of those while the elephants are having this larger discussion,” Lamar said.

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