Generalized relief among businessmen in the province after the decision to USA to suspend for six months the possible imposition of new tariffs on footwear in retaliation for the so-called Tasa Google. A truce that aims to facilitate an international agreement on this tax within the OECD. While waiting for that pact to avoid the tariff increase definitively, for the moment the manufacturers guarantee another season of sales -which is not little in the current situation, after the serious crisis caused by the covid- and they have already started all the machinery to make up for lost time and minimize the impact of the order stoppage in recent weeks.
And it is that the announcement of the United States Trade Representative It comes almost on the bell for many of the manufacturers, who these days were to start marketing the spring-summer season of next year. «On Monday we opened the ‘showroom’ in New York, coinciding with the celebration of the Fanny fair. It is when we make most of the sales and it would have been impossible to go without having clear prices. A rise of 25% is unaffordable, “he said yesterday Mila Garcia, President of the Eldense firm Pedro Garcia, that it has 65% of its turnover in this market and that it could not hide its joy. The businesswoman is confident that the uncertainty of the last weeks will not take its toll on orders and that sales will be good: “I do not think we will reach the 2019 figures, but we expect the trend to be positive,” he said.
In the case of Manufacturas Newman, your manager, Manuel Ruiz, He estimates that they have already lost between 15% and 20% of what they expected to sell this year in the United States with orders canceled in recent weeks and that they can no longer be recovered. However, Ruiz is also optimistic and, based on the conversations held with his clients, estimates that in a week new orders will begin to enter. “It is clear that cancellations can no longer be recovered, because customers moved production to other parts, but we arrived for the new season, which we have to serve from September,” explains the businessman.
Also well-known brands such as Pikolinos They valued the suspension of the new tariffs that, as recognized by the head of Marketing of the firm, Marcos Vega, would have had a “very serious impact” in what is the company’s second market. So much so, that the company was already studying measures to save this market even if the tax had been applied, although they acknowledge that it would have been complicated.
Along the same lines, the CEO of Wonders, Francisco Oliver, He showed his satisfaction, since the increase in sales in the United States is one of the great bets of the Carbonell family group to grow and diversify its markets, something that would have been almost impossible with the new customs rates. “We could have assumed the rise for a season, but then we would have had to pass on the cost and we do not know how consumers would have reacted,” said the executive yesterday.
«It has been a relief. Now we have to trust that a definitive agreement will be reached at the international level so that this is not repeated, “said the president of the Spanish Association of Footwear Components (AEC), Manuel Román.
In this sense, the Federation of Spanish Footwear Industries (FICE) also warned of the need not to relax and urged the Government to speed up negotiations as much as possible. “We are going to be very attentive and, if this summer we do not see progress, we will return with the pressure because what we do not want is to arrive again in December with this uncertainty,” said the president of this organization and the regional employer Avecal, Marián Cano .
In any case, both FICE and the government itself also highlighted the fact that the United States has decided to permanently leave out of the threat of tariffs three of the 15 categories of footwear that it wanted to impose more tariffs. Some categories that in 2019 added 50 of the almost 200 million euros that the sector exported to this country, according to figures provided by FICE, which mitigates the possible blow. But, above all, it is a loophole so that manufacturers can adapt their products to those categories to avoid the rise, in case the negotiation finally fails and there is no agreement.
The Government trusts the definitive suspension
The Minister of Industry, Reyes Maroto, was confident that the suspension of the tariff increase will become definitive, as she said, given the good progress of the negotiations being carried out in the OECD to reach a global agreement on taxation of multinationals, which would put an end to the Google Rate approved by Spain. For her part, the Minister of Finance, María Jesús Montero, went further, and assured that Spain will open bilateral negotiations with the United States to avoid tariffs, if there is no agreement in the OECD.
Eddie is an Australian news reporter with over 9 years in the industry and has published on Forbes and tech crunch.