They were part of sweeping tariffs by the Republican leader directed at countries around the world on Thursday, including 34 percent tariff on goods from China. That’s on top of the existing tax of 20 percent.
Speaking on an RTHK radio programme on Friday, association chairman Wingco Lo pointed out that the move has affected the stability of global supply chains, and has damaged the international trade order.
“There are a lot of variables and uncertainties, so manufacturers do not dare to move when it comes to planning, he said.
“We will wait and see what the US is going to do. Because its policies often keep changing.”
Lo noted that US firms and importers are also adopting a wait-and-see approach, and they might suspend placing an order, or doing it later than usual.
In the short-run, there might be a shock effect on trade activities, he said.
World leaders and businesses have expressed shock and concern by Trump’s tariff barrage, with many markets taking a similar stance of not making any major moves.
But Lo believes the imposition of tariffs are Trump’s bargaining chip and will not last long.
This is because Washington itself will also suffer from the move, especially its importers, ports, as well as retailers, according to Lo, and the measure would step up inflation and reduce consumer purchasing power.
He added that Hong Kong manufacturers are encouraged to open up new markets, and set up production lines in places with low, or even no tariffs.
Terence Chong, executive director of Chinese University’s Lau Chor Tak Institute of Global Economics and Finance, told the same programme that while he anticipates the SAR’s trade industry to suffer losses due to the levies, he expects the impact to be temporary.
The situation will get better when people adapt to the reciprocal tariffs, he added.
