Retailers and importers across the US - including those in the diamond and jewelry trade - breathed a collective sigh of relief this past weekend following the announcement of a temporary trade truce between the US and China, and an agreement to reopen negotiations. This past weekend at the Group of 20 summit in Osaka, Japan, U.S. President Trump and President Xi Jinping of China agreed to a ceasefire that will forestall another punishing round of of $300 billion in tariffs Mr. Trump had threatened to impose on nearly all Chinese imports; and this time, they would have included rough (unworked) and polished (worked) diamonds, rough and polished synthetic gemstones and 'jewelry articles of precious or semiprecious stones'.
As we noted in May, the list of Chinese products to be hit by 25% tariffs imposed by the U.S. government at the behest of President Trump is expansive and would cover almost the entirety of consumer products from China, including a broad swath of jewelry products (see the full list here). On May 9, the U.S. Trade Representative listed $300 billion in Chinese products, spread among nearly 4,000 categories, targeted for increased tariffs. In addition to diamonds and synthetic diamonds, the list includes: precious and semiprecious stones; rubies, sapphires, and emeralds; silver jewelry; gold necklaces; synthetic gemstones; but also metals used in jewelry creation, such as gold and silver. The fact that the tariffs are off the table for now is a huge win for retailers who typically import nearly all the products for the major holiday shopping period in July, August and September.