Is The Cost Of Makeup Going Up After Teriffs
By Keith Nuthall 27-Jun-2018
The motorcar and motorcycle industries have been in the spotlight after Trump threatened a 20% tariff, but the personal intendance industry is besides at risk
via Getty Images
The US personal care production manufacture is under fire, with the Eu (EU) and Canada and United mexican states announcing plans to impose protective duties on American exports post-obit the decision by the Trump administration to levy tariffs on steel and aluminium exports on these cardinal trading partners.
However, in Europe, there is existent concern that these tariffs could harm the EU's powerful personal care product industry.
The Eu executive, the European Committee, immediately published a regulation that will authorise its duties – they could be in force as early as 1 July.
European Commission President Jean-Claude Juncker said: "The European union believes these unilateral US tariffs are unjustified and at odds with World Trade Organization rules. This is protectionism, pure and uncomplicated."
The Canadian government has too been angered, and announced its own retaliatory duties, which information technology intends to impose from 1 July, having consulted on a shortlist of products.
A wide range of products have been listed for potential 10% duties. These include manicure or pedicure preparations, hair lacquers, pre-shave, shaving or afterwards-shave preparations and organic liquid or cream preparations for washing the peel.
Canadian Prime Minister Justin Trudeau has rejected Trump'southward justifications / via Getty Images
The future of ongoing talks to renew the North American Free Trade Agreement (NAFTA) take taken a heavy accident from tariff row, with Trump's justification of the American duties on national security grounds as well rejected by the Canadian regime.
Canadian Prime Government minister Justin Trudeau told a national press conference that he rejected the justification as spurious: "Let me be articulate – for the past 150 years, Canada has been the United States' most steadfast marry."
Cosmetics industry backlash
With the risk of American personal care product manufacturers losing significant exports, the Us industry association the Personal Care Products Quango (PCPC) has criticised the Trump assistants'south policy, maxim information technology and its member companies "remain strongly opposed to any policy that results in increased tariffs affecting international trade".
The PCPC said: "The administration's determination to impose tariffs on steel and aluminium imports negatively impacts our relationships with our strongest global allies.
"Inevitably, such increases volition atomic number 82 to countermeasures by trading partners, threatening access to markets that contributes to our industry's global growth and competitiveness."
Adding that cosmetics and personal care products companies rely heavily on open up markets, the council said that "vibrant international merchandise is disquisitional to the force of our industry and enhances our ability to expand manufacturing and employment, and to create the innovative products that consumers around the globe trust and savor."
Trump's views on the tariffs across all industries:
Based on the Tariffs and Trade Barriers long placed on the U.S. & its nifty companies and workers past the European Wedlock, if these Tariffs and Barriers are not soon broken down and removed, we volition be placing a 20% Tariff on all of their cars coming into the U.S. Build them here!
— Donald J. Trump (@realDonaldTrump) June 23, 2018
The United States is insisting that all countries that have placed artificial Merchandise Barriers and Tariffs on goods going into their state, remove those Barriers & Tariffs or be met with more than Reciprocity by the U.South.A. Trade must exist off-white and no longer a one way street!
— Donald J. Trump (@realDonaldTrump) June 24, 2018
....We are getting other countries to reduce and eliminate tariffs and trade barriers that have been unfairly used for years against our farmers, workers and companies. We are opening up airtight markets and expanding our footprint. They must play off-white or they volition pay tariffs!
— Donald J. Trump (@realDonaldTrump) June 26, 2018
Its concern is non surprising because America's exports of these tariffs-targeted lines are significant.
Regarding Canada, the US exported US$55.8m worth of manicure or pedicure preparations in 2017, co-ordinate to Statistics Canada, the government statistical agency.
Every bit for pilus lacquers, the Usa export booty to Canada in 2017 was $33.4m. Meanwhile, shaving, pre-shave and aftershave exports yielded $28.32m in receipts, and liquid and cream soap and other skin washing products netted an impressive $175m.
Historic European relations
With regards to the The states exports to the EU, these are as well significant regarding the lines targeted past Brussels' retaliatory tariffs: with €152m worth of eye brand-upward preparations sold in 2017; €96.3m worth of manicure and pedicure preparations; €88m worth of make-up and skin care powders; and €8m worth of hair lacquers.
While some onlookers might see this as an opportunity for Eu manufacturers to replace sales of American products, the European union industry association Cosmetics Europe is unhappy about Brussels' reaction.
Malgorzata Miazek, spokesperson at Cosmetics Europe, said: "The European Cosmetics manufacture is deeply concerned with the fact that the corrective and personal care products were included in the list of products on which the EU rebalancing measures on US imports are based.
"It is of import to recall that many Due north American brands of cosmetic and personal intendance products belong to European established and historical companies."
There has been mounting tensions between Trump, Merkel and other G-7 leaders over trade disputes / via Getty Images
A survey of Cosmetics Europe members showed that more than 67% of Us cosmetics exports targeted benefits European union companies, who either own the exporting United states of america brands or, to a lower degree, outsource manufacturing to United states of america subtractors.
"Sanctioning imports of these corrective products to the EU will therefore take in effect detrimental consequences for European companies and European jobs and growth," she said.
Miazek also stressed that the US is a significant market place for EU cosmetics in general, with currently an export surplus of 50% over imports.
"In example of any further escalation and United states of america counter measures on EU cosmetics – which we sincerely hope would non take place – the European union to US consign value of €3.2bn might be possibly severely damaged," she added.
As a issue, the association called on the EU to contrary its plans to impose tariffs on US personal intendance product exports: "Cosmetics and personal care products companies are truly global and dependent on open markets."
Trump explaining why he believes tariffs will benefit the U.s.a.
In the Uk, Dr Christopher Blossom, Director-Full general of the CTPA (Corrective, Toiletry & Perfumery Association), made similar comments.
He said: "Companies volition be affected at dissimilar levels. For example, either because they own United states of america brands exporting to the UK or because the visitor outsources manufacturing to U.s.a. subcontractors.
"In add-on, there are examples of United states companies or brands that are actually manufacturing within the Eu and where those products are subsequently re-imported into the EU; in this case a tariff could well damage European union manufacturing interests."
He warned that the EU cosmetics sector has meaning reliance on US imports because of the international integration of supply chains.
"It is hard to see how this measure will protect the Eu industry as such imports cannot be easily replaced," he added.
This was especially the example for brand-up, considering of the number of dissimilar shades involved. The CTPA has shared its concerns with United kingdom of great britain and northern ireland government officials, he said.
Meanwhile, the PCPC and others volition be keeping an centre on retaliatory duties imposed by other countries because of the Trump administration'due south aggressive trade policies.
For instance, Turkey imposed duties on The states cosmetics exports on 21 June, reacting to American steel and aluminium tariffs.
Turkey's Economy Minister Nihat Zeybekci / Getty Images
Calling the US tariffs "ill-advised", Turkey's Economic system Minister Nihat Zeybekci said they mirrored "the additional costs Turkey faces due to the tariffs imposed on it by the US," saying they would "protect Turkey's interests, while encouraging dialogue."
The The states exported USD17.3 1000000'southward worth of personal care products to Turkey in 2017, according to international trade data.
As it stands, the US government seems disinclined to back downwards over its shift towards protectionism, considering imposing duties on EU car exports, which could spark additional European union retaliation.
In a television interview, U.s. commerce secretary Wilbur Ross claimed that the US tariffs would forcefulness trading partners to reduce their own duties, equally a quid pro quo solution to the growing international trade war.
"We're going to gear up the problem of protectionism around the world…past making it more painful for those countries to exercise bad practices than to do the right affair, which is to lower the trade barriers and lower their tariffs," he suggested.
Companies
- Personal Care Products Quango
- CTPA Cosmetic Toiletry and Perfumery Association
- Cosmetics Europe
Source: https://www.cosmeticsbusiness.com/news/article_page/Industry_reaction_How_could_Trumps_tariffs_impact_the_cosmetics_business/144419
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