This commentary appeared in the print edition of the Jan. 6, 2020, Journal of Commerce Annual Review and Outlook.
This year has been unprecedented in terms of the challenges presented to international trade professionals. And for those of us who handle both compliance and logistics for our companies, it has been a double whammy.
First, compliance. For those of us that wear this hat, it hasn’t been just an issue of keeping up with the multiple rounds of tariffs being imposed, increased, and/or postponed, sometimes with only a few days of warning. It also has been looking for every avenue to minimize the impact: filing exclusion requests, setting up first sale arrangements, looking for duty drawback opportunities, and considering tariff engineering to move products from one HTS code into another, while, in the meantime, our merchandising group looks for ways to re-source to other countries — a time-consuming, and not always possible or practical, choice. On top of that, import professionals must now educate the buyers to understand the regulations allowing for a product to be considered made in another country, since, under certain circumstances, if part of the product is still made in China, we may be potentially exposing ourselves to a transshipment penalty.
And as we deal with these issues, those of us who also wear a transportation hat must cope with the uncertainty that has been attached all year to the looming IMO 2020 ­regulations. For the better part of the year, the carriers have been providing information that is, quite frankly, as clear as mud! Also, now that the carriers have learned how to manipulate the market to drive up rates — blank sailings, anyone? — how can we be sure the figure that they finally announce will not include some extra compensation to help them offset what has been an unusually weak peak season?
Someone once said, “May you live in interesting times.” That certainly applies to international trade these days. Unfortunately, I think it was also considered to be a curse!