After the announcement by Donald Trump, in April, customs duties aimed at the products entering the United States, the entrepreneur Ben Knepler seized his phone to call the Cambodian factory manufacturing his campsite furniture with a request: “Stop production. »»
At the time, the Kingdom of Southeast Asia risked seeing its products struck by a surcharge of 49%.
“That evening, we exchanged with our supplier,” recalls Mr. Knepler. “We just didn’t have the means to import our own products into the United States with such customs duties,” added the one who thought of avoiding this spell by avoiding having the campsite chairs of his company True Places, based in Pennsylvania, produced in China.
During the first term of Donald Trump (2017-2021), Beijing and Washington had launched themselves in a trade war, pushing Ben Knepler to relocate his production to Cambodia, which took almost a year.
“There was no (surcharge) for Cambodia” before Mr. Trump’s second term, he traces.
In the end, the surcharges aimed at Cambodian products have been established since last week at 19%, a cost that remains significant for the entrepreneur.
His experience reflects that of a myriad of small and medium -sized American companies drawing their products before making them abroad, whether toys or clothing.
Faced with customs duties, each attempts to find the right answer, either by passing on the additional cost on their customers, or by ceasing to import certain products, crossing their fingers for a trade agreement to allow them to be profitable again.
“In misfortune wheel”
According to the communication of the White House, the costs of customs duties will be provided by other countries, and the latter will report, this year, tens of billions of dollars in the federal state, a forecast that companies dispute.
“We have to pay the surcharge when the product enters the United States,” recalls Mr. Knepler, and “before selling it, we are those who pay”.
Already wet of a debt of hundreds of thousands of dollars used to finance the move of his production from China to Cambodia, he is now concerned about the future of his business.
For him, the rapid change in politics is akin to a “unfortunate wheel”, each turn of which would only add customs duties.
“Over the past four months, those on Cambodian products have increased from 0% to 49%, then 10%, 36% and finally 19%,” he recalls, “nobody knows what it will be tomorrow”.
The impact of these import taxes continues to worry economists, who see them feed inflation and slow growth in the United States, with employment effects.
According to a calculation of the WTO and the IMF, updated last week, the customs duties applied by the United States is now an average of 20.1%, its highest level since the early 1910s, apart from a few weeks of 2025.
The American president believes that inflation figures, which show a limited impact on prices in the United States, should silence criticism. But the experts expect repercussions spread over time.
Price increase
Customs duties are difficult to avoid. Barton O’Brien, which sells dog accessories, borrowed money and accelerated production in order to make as many stocks as possible before their entry into force.
During the presidential campaign, Donald Trump had threatened to apply 60% surcharge on Chinese products, such as those manufactured by the company of Barton O’Brien.
This veteran, living in Maryland, had to bring in a container with the maximum of products possible before the new customs duties returned into force. “I even had in the bathroom,” he says.
“Impossible”, according to him, to produce in the United States, where the cost would be almost six times higher than its sale price.
Its products are also manufactured in India and Vietnam, but the two countries are now targeted by a respective surcharge of 25% and 20%.
“If you look at my competitors, we all manufacture in the same countries. We will all have to increase prices, ”concludes Barton O’Brien.
