US stocks closed in the red after President Trump announced a new 10% tariff on $300 billion of Chinese-made products earlier in the week. Companies reliant on global trade were hit particularly hard on Friday, according to CNN.
Set to initiate September 1, 2019, the tariff effectively puts a tax on all imported Chinese goods not already targeted by American levies.
Whispers of an impending trade war only add stress to the global trade environment. For American businesses who source parts or products from China, or industries depend on global trade like American farmers, may experience widespread negative effects.
The repercussions will likely be reflected within the global Amazon marketplace, as many Amazon sellers around the world source their products from China-based manufacturers or B2B marketplaces.
The surprise tariff is likely to affect US consumers more than last year’s targeted tariff of industrial materials.
Though it may be too early to tell which products will be affected, a Morgan Stanley analyst estimates about 68% of the next goods tariffed will be consumer goods like apparel, electronics, sneakers, toys, and auto parts.
The increase in tariffs are intended to reduce trade with China, but may only result in trickling costs down from corporations to consumers instead of foreign importers absorbing the costs, as President Trump suggests.