Share via E-Mail Bookmark REUTERS: U.S.-based bicycle manufacturer Kent International has found a way around President Donald Trump's tariffs: by shifting production out of China. Like almost all U.S. bike makers, Kent has long relied on low-cost Chinese labor and parts, but Trump's tariffs have so far inflated his costs by about US$20 million annually.
Chinese authorities are keen to protect manufacturing jobs, too. To cushion the impact of tariffs, China has increased export tax rebates and quickened tax refunds to exporters, Margevicius said. It is also offering companies cheap loans. A more than 5 percent decline in the value of the Chinese Yuan last year, along with forecasts of further depreciation this year, are also helping blunt the impact of higher U.S. duties.
Specialized's Margevicius advises companies considering a move to look carefully at whether locations outside China have the required infrastructure to meet their needs. Each of the two biggest ports in Vietnam, for instance, has only a sixth of the capacity of the port of Shanghai, and Cambodia lacks a deep-water port to accommodate larger vessels.
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