It has been many months since US President Donald Trump unveiled controversial tariffs targeting imports, particularly those from China, which has elicited return tariff proposals by China and the European Union, sparking fears of an all-out trade war.
But the true impact has been uncertainty, and not just for businesses in those countries, with many Australian exporters and importers fearing whether their industry will be next to face the curbs.
“It’s just so uncertain at the moment. There hasn’t been specifically in what we’re dealing with for clothing or for wool, and a lot of people think it won’t affect us, but it could definitely if this trade war gets any worse,” Robin McGowan of menswear retailer InStitchu told My Business.
“Or it might just be that suddenly [Trump] says you can’t export anything from China – that could be a big, big issue.”
The company manufactures its garments in China, and while the majority of its stores are located here in Australia, it also operates a store in New York City in the US.
Mr McGowan noted that it is not just the tariffs themselves that can impact a business, with the effects on foreign exchange rates already having material impact.
“The Aussie dollar has dropped a lot, off the back of all this, so that can hurt you as well,” he said.
However, economist Carlos Casanova of credit firm Coface told a gathering in May that some Australian businesses may actually benefit from the so-called trade war, as global companies and consumers look for goods made in markets not subject to the tariffs, including Australia.