The Section 301 China Investigation - Global Trade Magazine
  May 29th, 2018 | Written by

The Section 301 China Investigation

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  • Boating contributes to the US economy with $37 billion in annual sales, supporting 650,000 jobs and 35,000 businesses.
  • Ninety-five percent of recreational boats sold in the US are made in the US.
  • US boat manufacturers rely on a competitive global market, fair pricing, and economic stability to grow.
  • The US marine industry currently faces multiple threats in the current trade climate.

Nicole Vasilaros, senior vice president, government and legal affairs at the National Marine Manufacturers Association (NMMA), the largest recreational marine industry trade association in the world, testified before the United States Trade Representative at a public hearing regarding the China investigation under Section 301 of the Trade Act of 1974.

The investigation, he said, could impact the $37 billion US recreational boating industry, particularly, marine engines, electronics, component parts and manufacturing machinery, which would hurt US marine manufacturers and consumer products.

“Our 1,300 North American members represent boat, engine, accessory, and trailer manufacturers and make up nearly eighty- five percent of the marine products sold in the United States,” said Vasilaros. “Boating significantly contributes to the United States economy with $37 billion in annual sales, supporting 650,000 jobs and 35,000 marine businesses.”

The US recreational boating industry is a uniquely American-made product, Vasilaros noted. “Ninety-five percent of boats sold in the US are made in the US,” she added. “American manufacturers like ours rely on a competitive global market, fair pricing, and economic stability to grow their businesses and hire more workers.”

The marine industry currently faces multiple threats in the current trade climate, according to Vasilaros: an antidumping and countervailing duty investigation on Chinese aluminum sheet, the Section 232 tariff on all aluminum and steel imports, retaliation by key allies and the Section 301 investigation impacting marine engines, electronics, component parts, and manufacturing machinery.

“The total economic impact of these tariffs on the marine industry is still unknown, however, for less than a handful of our members the combined impact of a twenty-five percent tax is well over $66 million to their operation,” said Vasilaros. “Not only do we expect the price of doing business to rise significantly for marine manufacturers but as a result, the cost of boats could rise too.

“Subjecting American businesses like US marine manufacturers to these tariffs, which don’t guarantee the objectives outlined by USTR in its Section 301 report and significantly increase the risk of Chinese retaliation on US products, is not the solution,” she concluded. “Instead, the trade and intellectual property issues we face with China would be better addressed through a negotiated, bilateral trade agreement. Otherwise, US marine manufacturers will be stuck footing the bill, which will impact profitability, increase costs to boaters, decrease sales, eliminate jobs, reduce investments in plant and equipment, and reduce US global competitiveness.”