There have been several developments on the trade and tariff front in the past few weeks. While NMMA said it is encouraged with the recent ratification of the United States-Mexico-Canada Trade Agreement (USMCA) and the initial Phase One Trade Agreement with China, the association says more work is needed to remove tariffs and ensure the recreational boating industry can continue to grow.
Earlier this month, the U.S. Senate ratified USMCA, sending the agreement to President Trump for his signature. Mexico has already approved USMCA, and now Canada must ratify the agreement before it can take effect – which they are expected to do in the coming days. Canada and Mexico account for 40% of the industry’s annual boat and engine export. NMMA applauds industry advocates for contacting their members of Congress through Boating United, urging Congress to quickly ratify USMCA and get this agreement across the finish line.
Despite the progress with USMCA, the global trade situation continues to cause serious challenges for the recreational boating industry, with input costs continuing to increase. On January 14, President Trump signed a partial trade agreement with China in an attempt to deescalate the ongoing trade war. While the deal cancelled tariffs – List 4B – that were set to take effect on Dec. 15, 2019 and reduces the tariff on products included in List 4A from 15% to 7.5% beginning on Feb. 14. However, NMMA said it is disappointed that the administration continues to impose a 25% tariff on $250 billion of Chinese products on Lists 1, 2 and 3 – which include more than 400 commonly used marine components and parts.
Last month, however, certain wake sport boat towers were among the recent products that the Trump administration granted tariff exclusions, bringing the total number of marine tariff exclusions granted to 15. The exclusion process for products on List 4A remains open until Friday, Jan. 31, 2020. The U.S. Trade Representative has posted instructions and NMMA stands ready to assist stakeholders throughout the exclusion process.
Retaliatory tariffs continue to be a concern for the boating industry, particularly from the European Union (EU). The EU continues to impose a 25% retaliatory tariff on U.S. boat and engine exports. NMMA has urged the administration to strike a trade deal with the EU that would end the retaliatory tariffs and reduce additional barriers to trade.
NMMA said it will continue to monitor all facets of trade and engage with the administration, Congress and stakeholders on trade issues impacting the recreational boating industry.