Global economists have urged the toy industry to remain cautious surrounding the topic of China-US trade relations, despite the two now being in a stage of negotiation.
The message was delivered at the Asian Licensing Conference yesterday where proceedings were drawn to a close with a discussion around the toy industry’s relationship with the Chinese market.
The message from Louis WK Chan, HKTDC Assistant Principal Economists (Global Research) was that with Mainland China representing 81.5 per cent of global suppliers, the industry should remain cautious. Even in light of the negotiations between China and the US.
While the toy industry is currently not targeted by sweeping new tariff barriers, he stated, it was “not impossible” for the toy industry to be affected.
Offering advice on how to cope with possible US tariffs on toys, Mr Chan mentioned the possibility of products being put forward for being ‘specifically excluded’ from tariffs, with some 984 requests having been approved by the US recently.
He also highlighted strategies such as setting up e-commerce operations, considering the reclassification of products and applying for a rule to lower the price of a product related to value as legitimate ways of avoiding tariff charges.
Chan mentioned Poland, Chile, the Czech Republic, Vietnam and India as among the countries where good opportunities were emerging, and indeed where local companies were looking for new suppliers.
Hong Kong was also expanding on the number of free trade agreements such as those recently concluded with the Association of Southeast Asian Nations (ASEAN) and Georgia.
Meanwhile, industry veteran Richard Gottlieb of Southern California highlighted that with Hong Kong continuing to create opportunities through its IP protection capabilities, China would become the overall largest consumer of toys by 2022.
He stated that the global toy industry should take a ‘unified position in the face of tariff threats and amplify its position on free trade and safety standards.”