Washington, DC – Tariffs on imports of intermediate chemicals are undermining industry’s ability to invest in innovative new products, according to Jason Bernstein, director of global affairs at the American Chemistry Council. His comments were made during testimony to the US International Trade Commission’s investigation into the economic impact of section 232 and 301 tariffs.
Bernstein highlighted a key difference between the effects of tariffs on end-products and intermediate inputs. ‘The tariffs have disrupted the US chemical industry’s supply chains and business operations,’ he said. ‘Most of all, they continue to undermine the US Administration’s objectives to make our supply chains more resilient, rebuild and fortify US infrastructure, and cultivate policies that promote American economic competitiveness.’
Many ACC members are finding it increasingly difficult to meet the objectives of these initiatives while these tariffs remain in place, he claimed, with the US chemicals sector among the hardest hit by the tariffs, which affect almost three-quarters of its imports. ‘While several sectors saw much higher tariffs overall, tariff rate increases, and/or share of products affected, chemicals were among the top sectors where most of the 301 tariffs were paid,’ he said.
A Trade Partnership Worldwide study showed that aggregate imports of chemicals from China have increased, despite the tariffs. This is largely because there are few alternatives to many inputs produced in the country.
‘Many of the Administration’s initiatives are focused on increasing supply chain resiliency and promoting domestic production,’ Bernstein said. ‘But keeping tariffs in place when they clearly increase the cost of doing business in the US undermines to this objective.’