Ad Banner
Advertisement by Open Privilege

Hong Kong exporters face crisis as US slaps steep tariffs on small parcels

Image Credits: UnsplashImage Credits: Unsplash
  • The U.S. has introduced new trade measures that significantly raise tariffs on low-value shipments from Hong Kong, increasing the rate from 30% or $25 to 90% or $75 per item, effective May 2, 2025.
  • Hong Kong exporters have been warned against attempting to bypass the new tariffs through small parcel loopholes, with potential penalties for non-compliance and increased scrutiny from U.S. customs authorities.
  • The Hong Kong government has condemned the move, arguing it undermines its independent customs status, while industry leaders express concern over rising costs and logistical disruptions.

[WORLD] Hong Kong exporters are dealing with new US trade rules that have a substantial impact on tiny parcel shipments. Former President Donald Trump's recent executive order triples duties on low-value goods from Hong Kong, raising concerns about potential evasion strategies and compliance issues. The policy change, which takes effect on May 2, 2025, replaces the existing 30% or $25 duty with a 90% tariff or a flat $75 per item for a wide range of consumer items.​

The tariff hike specifically targets goods valued under $800, a threshold previously exempt from higher duties under the U.S. de minimis rule. This exemption has long been a lifeline for small businesses and e-commerce sellers, but the new policy effectively closes this loophole for Hong Kong-origin shipments. Industry analysts warn that the move could disproportionately affect small and medium-sized enterprises (SMEs), which lack the resources to absorb the additional costs or reroute supply chains.

This article is intended for business owners, logistics professionals, policymakers, and stakeholders in the e-commerce and trade sectors who are directly affected by international shipping regulations and tariff policies.

U.S. Tariff Changes and Their Impact

The U.S. Postal Service's temporary halt on accepting packages from China and Hong Kong earlier this year disrupted global supply chains. Although the suspension was later reversed, it highlighted the challenges faced by exporters in navigating the evolving tariff landscape.

The latest tariff increase is part of a broader U.S. strategy to address concerns over trade imbalances and alleged circumvention of sanctions. Hong Kong’s unique position as a global trade hub has made it a focal point in these tensions, with U.S. officials citing the need to prevent the diversion of goods subject to existing China-specific tariffs. However, critics argue that the measures risk stifling legitimate trade and harming U.S. consumers who rely on affordable imports.

In response to these developments, the Hong Kong government has expressed strong disapproval of the U.S. measures, emphasizing that they undermine the city's status as a separate customs territory recognized by the World Trade Organization (WTO).

Compliance and Enforcement Challenges

The increased tariffs raise concerns about potential evasion tactics, such as undervaluing shipments or misclassifying goods to avoid higher duties. Customs authorities are expected to enhance scrutiny of low-value packages, which could lead to delays and increased costs for exporters.

Logistics providers are already reporting a surge in inquiries from exporters exploring alternative shipping routes, such as transshipment through Southeast Asian countries. However, these workarounds come with their own complexities, including higher transportation costs and longer delivery times. Experts caution that while rerouting may offer short-term relief, it is not a sustainable solution for Hong Kong’s export-dependent economy.

Hong Kong's Response and Future Outlook

In light of the new tariffs, Hong Kong plans to file a complaint with the WTO, asserting that the U.S. measures violate international trade agreements and disregard Hong Kong's separate customs status. The outcome of this dispute could have significant implications for future trade relations between Hong Kong and the U.S.

Meanwhile, local trade associations are urging the Hong Kong government to provide financial support, such as subsidies or tax incentives, to help exporters weather the transition. Some lawmakers have also called for accelerated diversification of export markets, particularly in regions like the Middle East and Southeast Asia, where demand for Hong Kong’s goods remains strong.

The recent changes in U.S. tariff policy present significant challenges for Hong Kong exporters, particularly those relying on small parcel shipments. As businesses adapt to these new regulations, ongoing dialogue and potential dispute resolution through international trade bodies will be crucial in shaping the future of cross-border trade between Hong Kong and the United States.


Ad Banner
Advertisement by Open Privilege

Read More

Relationships World
Image Credits: Unsplash
RelationshipsApril 28, 2025 at 6:30:00 PM

Mentoring supports mothers returning to work

[WORLD] As more mothers return to the workforce after giving birth, many face the challenge of balancing professional expectations with the demands of...

Health & Wellness World
Image Credits: Unsplash
Health & WellnessApril 28, 2025 at 3:30:00 PM

Surprising beauty benefits of everyday foods

[WORLD] We’re all familiar with the age-old advice to eat our vegetables for a healthy body, but did you know that some everyday...

Politics World
Image Credits: Unsplash
PoliticsApril 28, 2025 at 11:30:00 AM

Israel faces pressure to lift aid ban in Gaza crisis

[MIDDLE EAST] As the humanitarian situation in Gaza continues to deteriorate, Israel is facing increasing international pressure to lift its ban on aid...

Economy World
Image Credits: Unsplash
EconomyApril 28, 2025 at 11:00:00 AM

China confident in hitting 5% growth target amid trade war pressures

[WORLD] China remains "fully confident" in its ability to meet its target of approximately 5 percent economic growth this year, despite the ongoing...

Economy World
Image Credits: Unsplash
EconomyApril 28, 2025 at 11:00:00 AM

Singapore pursues U.S. concessions on key industries

[SINGAPORE] Singapore is engaged in high-level negotiations with the United States over securing critical concessions in the areas of pharmaceuticals and semiconductor chips....

Economy World
Image Credits: Unsplash
EconomyApril 28, 2025 at 10:30:00 AM

Hong Kong stocks slip amid stimulus hopes and tariff tensions

[WORLD] Hong Kong stocks fell as investors awaited an upcoming briefing from Chinese authorities on potential stimulus measures, amid uncertainties over economic support...

Finance World
Image Credits: Unsplash
FinanceApril 28, 2025 at 10:00:00 AM

Ringgit holds steady amid global market uncertainties

[MALAYSIA] The ringgit opened largely unchanged against the US dollar on Monday, as the greenback regained footing following a four-week decline, with the...

Finance World
Image Credits: Unsplash
FinanceApril 28, 2025 at 10:00:00 AM

Foreign funds return to Bursa Malaysia after six-month exodus

[MALAYSIA] After 26 weeks of net selling, foreign investors have returned to Bursa Malaysia, marking a net inflow of RM332.3 million. This shift...

Politics World
Image Credits: Unsplash
PoliticsApril 28, 2025 at 9:30:00 AM

Europe on alert as Russia expands military presence

[EUROPE] As Russia escalates its military presence and hybrid operations near European borders, and with U.S. security commitments in doubt, European leaders face...

Finance World
Image Credits: Unsplash
FinanceApril 28, 2025 at 9:30:00 AM

Stocks rally as calm returns

[WORLD] Stocks surged last week, marking the most robust rally since early 2025, as investor sentiment improved following signals of easing trade tensions...

Tech World
Image Credits: Unsplash
TechApril 28, 2025 at 9:30:00 AM

Huawei launches AI chip to rival Nvidia

[WORLD] Huawei, the Chinese telecommunications giant, has unveiled a new AI chip designed to rival Nvidia's dominance in the burgeoning artificial intelligence (AI)...

Finance World
Image Credits: Unsplash
FinanceApril 28, 2025 at 9:00:00 AM

Asian currencies hold steady amid trade tensions

[WORLD] Asian currencies consolidated on Monday as investors and policymakers across the region assessed the latest U.S. economic data and braced for the...

Ad Banner
Advertisement by Open Privilege
Load More
Ad Banner
Advertisement by Open Privilege