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Tag: Tariffs

  • Pakistan Used Car Imports Top 2,000 Units in October

    Pakistan Used Car Imports Top 2,000 Units in October

    More than 2,000 used vehicles entered Pakistan under the overseas gift scheme in October, defying state restrictions and accelerating an influx of foreign-built automobiles into the domestic market.

    The arrival volumes represent an aggressive rebound from May this year, when tighter customs oversight had temporarily squeezed monthly gift-scheme imports down to just seven units, according to former Pakistan Association of Automotive Parts and Accessories Manufacturers (PAAPAM) chairman Aamir Allawala.

    By September, shipments had expanded to 2,238 units before holding above the 2,000 mark through October. Domestic automotive parts vendors say these transactions bypass conventional banking channels, relying on payments to Japanese auction houses through informal hawala networks and cash settlement inside Pakistan.

    Surging Influx of Built-Up Vehicles

    Official trade data tracks the broader import trend. Inward shipments of completely built-up units, covering both new and second-hand passenger cars, jumped 40 per cent to $126 million during the first quarter of fiscal year 2026-27, compared with $90 million in the same three months of the prior fiscal year, according to the Pakistan Bureau of Statistics.

    Automakers entering the market account for part of the increase. Brands are bringing fully assembled vehicles into showrooms to test consumer appetite across major urban centers before committing capital to domestic assembly lines.

    The commercial friction deepened following the release of the government’s revised automotive policy in early November. Engineering groups say the framework shifts incentives toward finished imports and complete assembly kits, weakening the 1,200 local manufacturing firms that supply parts to domestic car plants.

    The Breakdown of Local Content

    The domestic parts footprint varies sharply across competing brands operating in Pakistan. Vehicles assembled from Japanese partners currently integrate between 50 per cent and 65 per cent locally produced components. Korean models carry 20 per cent to 25 per cent domestic content, while newly introduced Chinese vehicles operate with zero to 5 per cent local parts.

    Locally assembled vehicles typically absorb between Rs1.5 million and Rs2.5 million worth of parts produced by domestic engineering shops. The Pakistan Association of Automotive Parts and Accessories Manufacturers warned that lowering trade barriers will induce vehicle assemblers to import foreign components rather than procure them from local suppliers.

    The association said the domestic component manufacturing sector directly employs 300,000 workers and supports 1.5 million indirect jobs across the wider automotive value chain.

    Tariff Disparity with Regional Assembly Hubs

    Auto suppliers take particular issue with the proposed application of Pakistan’s National Tariff Policy to the vehicle sector. PAAPAM Chairman Abdul Rehman Aizaz pointed out that the draft auto policy sets duties on completely built-up units at 15 per cent, running counter to the protective tariff walls maintained by regional assembly hubs.

    India levies tariffs of 120 per cent on completely built-up vehicles, while Thailand applies an 80 per cent duty and Indonesia charges 52 per cent to protect domestic plants and supply networks.

    “All these vehicles are imported through payments to Japanese auction houses via hawala channels and unregulated domestic sales through cash transactions,”

    The revised policy also establishes a 5 per cent duty on fully imported small electric vehicles alongside reduced sales tax rates. Parts makers argue that while these tax cuts may lower retail prices for vehicle buyers by 5 per cent to 7 per cent, car purchasers represent barely 0.1 per cent of the national population.

    Shifting Rules from Consultation to Policy

    The standoff follows an abrupt pivot in industrial policy formulation between the middle and end of the calendar year. Component manufacturers stated they took part in formal consultative sessions with the Ministry of Industries through June 2026, agreeing on a localization-focused roadmap.

    That consensus dissolved when the final policy emerged in November with lower barriers for commercial imports, completely built-up electric cars, and 100 per cent completely knocked-down kits. Manufacturers say the resulting import bill will drain foreign exchange reserves at the State Bank of Pakistan while leaving revenue shortfalls at the Federal Board of Revenue.

    Industry groups are now pressing the Ministry of Industries to review the import rules and address the gift scheme trade, with assembly plants monitoring whether government customs enforcement stops the flow of Japanese auction arrivals.

  • Thailand Approves up to 30% Import Duties on Cross-Border E-Commerce

    Thailand Approves up to 30% Import Duties on Cross-Border E-Commerce

    Thailand’s cabinet approved import tariffs reaching up to 30 percent on goods ordered through cross-border e-commerce platforms, Finance Minister Ekniti Nitithanprapas confirmed on Tuesday.

    The policy targets small postal consignments entering through international mail and express freight networks, with tax collections projected to yield 6.3 billion baht.

    Customs Director-General Phantong Loykulnanta confirmed the higher tariff schedules will take effect early next year across all standard customs categories. Under the new rules, the government will override an existing Customs Department notification that previously granted duty cuts or blanket exemptions for commercial goods shipped in small parcel form.

    Reverting to Standard Tariff Classifications

    The revised regime brings direct-to-consumer parcels back under standard national tariff lines. Duty on imported plastic goods rises from 20 percent to 30 percent. Tariffs on imported headphones, microphones, and fitness gear increase from 10 percent to 30 percent. Duties on women’s handbags jump from 20 percent to 30 percent, sunglasses climb from 5 percent to 30 percent, and imported jewellery faces a 30 percent tariff, up from zero. Clothing import duties remain fixed at 30 percent.

    Customs authorities will collect duties directly at digital checkout or upon physical parcel entry through technical links with postal carriers and e-commerce platforms. Officials maintained that resetting small parcel duty rates to standard tariff schedules complies fully with regional trade commitments under the Asean-China Free Trade Agreement.

    Pressure Mounts on Cross-Border Marketplaces

    For regional marketplaces relying on cross-border merchant corridors, the end of parcel exemptions dismantles their core pricing advantage. Sellers operating on platforms will see landing costs jump overnight, forcing merchants to absorb the margin hit or pass increases directly to Thai shoppers. Local logistics partners handling final-mile distribution must prepare for higher cart abandonment rates as retail sticker prices climb across key consumer tech and lifestyle categories.

    Domestic retail conglomerates and brand distributors, by contrast, gain immediate breathing room against unregulated grey-market parcel flows. Importers with physical warehousing inside Thailand have long absorbed full commercial import duties, storage overhead, and inspection clearance fees. Forcing low-value consumer parcels into identical duty brackets eliminates the structural loophole that penalised formal supply chains.

    Closing the Low-Value Tax Loophole

    This tariff revision follows an earlier tax adjustment introduced at the start of the year. On January 1, the government began collecting 7 percent value-added tax alongside standard duties on small parcels valued below 1,500 baht, ending a long-standing de minimis exemption.

    Ekniti stated that the surge in cross-border e-commerce volumes had saturated local distribution channels with low-cost imported products, undermining pricing power for domestic small and medium-sized manufacturers. By closing parcel-level tariff breaks, the finance ministry intends to equalise terms between cross-border digital sellers and domestic physical businesses.

    Thai customs authorities are now finalising technical integration protocols with international courier networks ahead of the formal enforcement date early next year.

  • Bangladesh Fruit Import Duties Reached Nearly Tk 6,000 Crore in FY26

    Bangladesh Fruit Import Duties Reached Nearly Tk 6,000 Crore in FY26

    Bangladesh collected nearly Tk 6,000 crore in import duties on fresh fruits in fiscal year 2025-26, doubling customs revenue over five years even as private shipments fell 29 per cent.

    Importers brought in 5.7 lakh tonnes of produce such as apples, oranges, grapes, and mandarins during FY26, down from 8 lakh tonnes in FY21, according to an assessment by the Bangladesh Trade and Tariff Commission.

    Tax rates explain the divergence. Total import taxes on fresh fruit climbed from 89.32 per cent in FY21 to 121.78 per cent in the current fiscal year 2026-27. Customs duties, regulatory levies, and supplementary taxes pushed retail prices beyond the reach of low-income shoppers. In Dhaka, apples that sold between Tk 250 and Tk 340 a kilogram two years ago now fetch between Tk 300 and Tk 400. Several years ago, shoppers paid less than Tk 300 per kilogram.

    Currency Slump and Cash Margins Hit Grocers

    Currency depreciation compounded the tax shock. The Bangladeshi taka weakened 43 per cent against the greenback, sliding from an average of Tk 84.80 per US dollar in FY21 to Tk 121.50 in FY26. Importers had to absorb that exchange rate hit alongside a 100 per cent cash margin requirement on letters of credit introduced during the 2023 foreign exchange crunch. Bangladesh Bank recently withdrew that cash margin rule as foreign exchange reserves stabilized, yet retail prices have not retreated.

    Food retailers in urban markets added their own buffers. The commission found that retail grocers widened their percentage markups faster than wholesale distributors, passing all foreign exchange risk directly to consumer baskets. Higher prices have crimped dietary options during peak dengue treatment periods, when hospital demand for vitamin C-rich citrus spikes.

    A Tax on Crops Farmers Do Not Grow

    Horticultural protection does not justify the import levy. Bangladesh maintains zero commercial domestic production of apples, oranges, mandarins, grapes, pears, or pomegranates. Every piece of these fruits consumed in the country arrives through ports.

    By treating baseline table fruits as luxury merchandise, tax policy creates severe consumer distortions without shielding a single local orchard. The tariff commission confirmed that Bangladesh now imposes the highest fresh fruit import duties in South Asia, while Nepal levies the lowest.

    The Tariff Rollback Model

    The commission formally recommended that the commerce ministry drop both supplementary duties and regulatory duties on non-native fruit imports. Lowering the overall tax incidence back to 89 per cent would reverse volume declines without sacrificing public coffers, according to agency projections. The commission estimated the National Board of Revenue could harvest more than Tk 6,500 crore if import volumes rebounded to 8.20 lakh tonnes under lower tariff rates.

    Consumers Association of Bangladesh President AHM Shafiquzzaman backed the reduction, arguing that public health demands affordable produce.

    “Across the world, prices of the fruits appear to be the highest in Bangladesh. But as fruit is part of public health, people should have options to decide whether they would consume locally produced fruits or imported ones. The authority should consider collecting other options to collect revenue,” he added.

    What Lies Ahead for Importers

    The earlier step that started this squeeze was the National Board of Revenue’s tariff hike in fiscal year 2021-22, designed to brake foreign exchange outflows. That emergency barrier outlived its immediate purpose, leaving fruit importers with stranded balance sheets and suppressed order books.

    The commerce ministry now faces a formal decision on whether to accept the commission’s tariff cut proposal and submit a revised rate sheet to the National Board of Revenue ahead of the mid-year budget adjustments.

  • China Warns UK of Firm Retaliation over Electric Vehicle Tariffs

    China Warns UK of Firm Retaliation over Electric Vehicle Tariffs

    China’s Ministry of Commerce threatened countermeasures against Britain on Monday if London introduces import duties on Chinese electric vehicles. The warning follows British trade minister Anas Sarwar’s remarks confirming ongoing discussions with European partners over potential alignment with European Union tariffs of up to 45.3 per cent.

    Beijing urged the UK to follow World Trade Organization rules and maintain equal trade terms rather than copying Brussels. Automotive cooperation between both countries relies on complementary strengths, the ministry said in an official statement.

    “China will closely monitor the UK’s actions. If the UK insists on imposing restrictions on Chinese EVs, China will take firm countermeasures to safeguard the legitimate rights and interests of its industry,” the ministry said.

    London weighs European market access

    British officials are balancing domestic trade ties with European supply integration. London wants British manufacturers included in the EU’s Industrial Accelerator Act, a framework giving local production preferential access to public procurement programs.

    Exclusion from that initiative would penalize vehicle assembly operations across Britain. To secure access, EU negotiators asked London to align vehicle tariffs directly against Chinese carmakers, turning trade protection into an entry fee for European industrial policy.

    Retaliation risks for British exporters

    British Business Secretary Jonathan Reynolds acknowledged the friction in September, pointing out that the domestic automotive manufacturing base relies heavily on export markets. Any Chinese tariff retaliation would hit British luxury vehicle shipments hard, slicing into margins for premium brands that count China as their primary profit engine outside Europe.

    For Chinese original equipment manufacturers, losing tariff-free access to Britain would alter dealer pricing models and compress gross margins on mass-market models like the MG4 hatchback. Importers would have to absorb the cost difference or pass price increases to British car buyers, dampening EV adoption rates across consumer segments.

    The fallout from the 2024 duties

    Brussels imposed definitive countervailing duties on Chinese battery electric vehicles for five years in October 2024. Those levies added between 7.8 per cent and 35.3 per cent on top of standard 10 per cent baseline import duties, pushing total import taxes to 45.3 per cent for affected producers.

    Britain chose not to replicate those duties at the time, keeping its market open and becoming an essential European distribution hub for Chinese automakers. The European Commission subsequently urged London in September to eliminate that regulatory gap.

    Expansion plans continue regardless

    Chinese brands are pressing ahead with British retail distribution networks despite the regulatory dispute. Chery plans to introduce its iCar brand into the UK market under the name iCaur with the launch of the V27 in early 2027.

    That rollout will represent Chery’s fifth distinct brand trading in Britain. Whether those vehicles face standard import duties or double-digit countervailing penalties depends on the final terms London negotiates with Brussels over the coming months.

  • Pakistan Raises Import Duties on Tyres and Motorbike Parts to Protect Local Industry

    Pakistan Raises Import Duties on Tyres and Motorbike Parts to Protect Local Industry

    Pakistan raised additional customs duty on imported tyres and motorcycle components on Thursday. The tariff on certain bike parts climbs to 31 per cent to shelter domestic manufacturers.

    Cabinet members on the Economic Coordination Committee lifted the additional customs duty on locally manufactured radial tyres and motorcycle components from 4 per cent to 11 per cent. Rates on motorbike parts imported by local assemblers surged from 11 per cent to 31 per cent.

    Finance Minister Muhammad Aurangzeb presided over the Islamabad meeting. The committee altered statutory regulatory order SRO 693(I)/2006 on the recommendation of the Revenue Division. These tariff hikes follow the first quarter of the fiscal year and coincide with a staff-level agreement with the International Monetary Fund.

    Higher tariffs on tyres and motorcycle components

    Imported parts that compete with local suppliers face direct penalties under the new structure. Components brought in by vehicle assemblers take the steepest hit, jumping 20 percentage points to 31 per cent. Finished radial tyres and replacement parts now carry an 11 per cent levy.

    Revenue Division documents confirm the amendment to SRO 693(I)/2006 targets imports where domestic manufacturing capacity already exists. Officials structured the differential to push assemblers toward local supply contracts over foreign procurement.

    Vehicle assemblers across the country have long relied on imported knock-down kits from China, Japan and Southeast Asia. The wider tariff gap raises landed costs on foreign parts. Assemblers must now absorb the higher expenses or negotiate domestic purchasing contracts.

    Protectionist shelter for domestic assemblers

    Component vendors gain a protected customer base in a volatile retail market. Two-wheelers dominate urban transport in Karachi, Lahore and Rawalpindi. Consequently, motorbike parts rank among the largest consumer replacement categories in Pakistan.

    Motorcycle manufacturers must now speed up vendor localisation programmes. Assemblers that failed to build local supply networks over the past decade face immediate cost disadvantages. Competitors with higher domestic parts content will hold an edge.

    Retail buyers will feel the impact quickly at motorcycle repair shops and tyre dealerships. Importers of Japanese and Chinese radial tyres must raise wholesale prices or lose ground to domestic tyre makers in Punjab and Sindh.

    Credit guarantees and small business funding

    Credit guarantee measures accompanied the tariff decisions. The State Bank of Pakistan designed a structure to expand lending to small suppliers and the agricultural sector. The scheme provides 20 per cent first-loss coverage on loans to small enterprises, alongside 10 per cent coverage for medium industries and small farmers.

    Risk-sharing under the programme will flow through Agency Financial Institutions, connecting non-banking lenders and microfinance firms to state guarantees. The committee also amended the Second Supplemental Trust Deed of the Credit Guarantee Trust Fund. That step expands a housing finance facility created for the Prime Minister’s Mera Pakistan Mera Ghar initiative.

    Total supplementary grants cleared during the session reached Rs57.85 billion across 11 allocations. Within that sum, the Small and Medium Enterprises Development Authority secured Rs2 billion to execute its corporate plan.

    Restructuring state retail and infrastructure

    Industries and Production Division officials secured Rs11.329 billion to shut down the state-owned Utility Stores Corporation. The state retail chain operated thousands of discount grocery outlets nationwide. The closure forms part of a wider push to rationalise state enterprises.

    Infrastructure spending took up the rest of the major allocations. The Public Private Partnership Authority received Rs8 billion for project delivery. Meanwhile, the Ministry of Railways received Rs10 billion for the Thar Coal Rail Connectivity Project, linking domestic coal reserves to power stations and industrial buyers.

    Export Development Fund balances will also be invested in government securities to earn sovereign yields on idle trade funds. Revised customs tariff schedules take effect immediately across all major customs ports.

  • EU Prepares Hybrid Quotas as Chinese Imports Surge to 50,000 Units

    EU Prepares Hybrid Quotas as Chinese Imports Surge to 50,000 Units

    The European Commission is preparing import restrictions on Chinese hybrid vehicles after monthly shipments surged from 3,800 units in October 2024 to around 50,000 units by July 2026.

    Brussels moved toward safeguard procedures after China rejected requests for voluntary export curbs, as Chinese automakers including BYD and MG Motor increasingly pivot toward hybrid models in Europe.

    Safeguard Quotas Replace Pure Tariffs

    Under the proposed framework, Chinese hybrid models will enter the European Union under the standard 10 per cent automotive tariff up to an agreed volume ceiling. Any shipments exceeding that quota will face an additional special duty.

    Safeguard instruments apply to whole product categories rather than individual manufacturers, unlike the anti-subsidy duties on battery electric vehicles. European authorities can deploy them rapidly if sudden import surges threaten material injury to domestic car plants.

    China’s Ministry of Commerce rejected earlier requests for voluntary limits. The ministry stated that “so-called voluntary export restrictions seriously violate WTO rules and run counter to market principles and fair competition”.

    Hybrid Surge Bypasses Battery EV Duties

    Chinese automakers shifted their export focus toward plug-in and full hybrids after the European Union enacted anti-subsidy duties of up to 35.3 per cent on pure electric models in October 2024. That regulatory gap left hybrid powertrains exposed only to standard baseline import duties.

    Volume surged immediately. BYD registered 11,291 units of its Seal U DM-i plug-in hybrid in Germany alone between January and September, while SAIC Motor’s MG brand expanded its European presence through full-hybrid drivetrains.

    Total hybrid arrivals from China climbed from 3,800 vehicles in October 2024 to roughly 50,000 units by July 2026. For EU policymakers, the influx sustained price pressure on domestic carmakers while increasing fleet emissions contrary to regional climate targets.

    Local Assembly Accelerates Across Europe

    Trade barriers on fully built imports are driving Chinese investment into European production hubs. BYD begins series production at its new manufacturing plant in Szeged, Hungary, before the end of the year.

    Chery is assembling vehicles alongside Ebro at a joint facility in Barcelona. Xpeng has established semi-knocked-down assembly operations with Magna Steyr in Graz, Austria. These footprints mirror agreements Japanese manufacturers struck with European authorities four decades ago, trading import caps for regional factory investments.

    For Asian supply chains, the pivot from finished vehicle shipping to local assembly shifts freight demand toward battery cells, sub-assemblies, and specialized automotive components.

    Talks Underway in Beijing

    European Union Trade Commissioner Maroš Šefčovič opened direct negotiations in Beijing with Chinese Commerce Minister Wang Wentao. The two sides are discussing export caps and minimum price undertakings across both electric and hybrid categories.

    EU trade officials want an enforceable ceiling that shields domestic manufacturing while local factories ramp up competitive electrified powertrains. Bernd Lange, Chairman of the European Parliament’s Trade Committee, stated: “The goal is to flatten the import curve and give the European automotive industry time to do its homework.”

    Negotiators must now settle terms before the European Commission formally launches the safeguard procedure. Import volumes through the final quarter will determine the quota baseline.

  • JD.com Opens Suzhou Mall for Trial Operation on Oct. 1

    JD.com Opens Suzhou Mall for Trial Operation on Oct. 1

    JD.com opened a shopping mall for trial operations on Oct. 1 in Suzhou. The opening expands the company’s retail footprint in eastern China. It also fits Beijing’s policy shift away from debt-backed real estate sales toward domestic household spending.

    Local governments across China face shrinking receipts from commercial land transfers. Replacing those proceeds requires steady transaction volumes at brick-and-mortar storefronts, shopping centers and tech hubs.

    Offline Footprint in Suzhou

    The Suzhou property bridges JD.com’s digital logistics network with large physical retail assets. The facility began trial operations at the start of the golden week holiday. It targets regional shoppers with consumer electronics, home goods and lifestyle merchandise.

    Physical flagships allow e-commerce platforms to capture on-site customer service revenue and handle returns faster. They anchor local retail districts. That gives city administrators a direct pipeline to consumer tax receipts.

    From Land Sales to Store Receipts

    For decades, local authorities relied on developer auctions to balance city budgets and fund civic infrastructure. That mechanism stalled as property construction slowed nationwide. Central planners now encourage municipal leaders to build tax bases around recurring retail sales, consumer services and commercial logistics.

    City halls have shifted how they treat commercial tenants. Municipal officials prioritize operators that deliver high sales turnover and dependable point-of-sale tax revenue over one-time development premiums. Retailers with established supply chains hold stronger bargaining power during site negotiations.

    Luxury Expansion and Industrial Demand

    Luxury mall operators are also pursuing store expansions across China, defying broader retail caution. High-end property managers are adding space in regional commercial centers to capture resilient premium spending.

    Industrial data reflects broader economic stabilization. Chinese factory activity expanded in September, lifted by output across artificial intelligence supply chains and consumer hardware manufacturing.

    Trade Truce and Operating Headwinds

    Cross-border trade conditions provide temporary breathing room for domestic retailers managing inventory and supply chains. Beijing and Washington agreed to extend their bilateral trade truce until January, according to statements following high-level economic negotiations.

    Import duties climbed toward 145 per cent before negotiators established commercial frameworks, including the Busan understanding in October 2025. Stabilized tariffs reduce input price volatility for merchants stocking electronics and imported goods.

    JD.com will evaluate customer footfall and tenant sales data during the Suzhou trial phase before setting the date for full commercial operations. Retail operators will watch the January expiration of the bilateral tariff truce.

  • Toyota Commits $3.6 Billion to Shift Tacoma Production to Texas

    Toyota Commits $3.6 Billion to Shift Tacoma Production to Texas

    Toyota Motor has committed $3.6 billion to expand its San Antonio plant and relocate Tacoma pickup production from Mexico to Texas as carmakers adjust to a 25 percent import tariff on foreign-built vehicles in October 2026.

    The Japanese automaker joins General Motors and Ford in reallocating capital to domestic assembly lines, yet industry economists warn that tariff volatility is stalling broader supply chain investments across the sector.

    Tariff Pressure and North American Assembly

    Japanese automotive groups face difficult calculations as United States trade policy penalizes cross-border supply networks across Mexico and Canada. Toyota is pouring $3.6 billion into its Texas operations to bring Tacoma pickup manufacturing inside American borders, insulating its light-truck volume from cross-border import levies. General Motors is spending $4 billion across facilities in Michigan, Kansas and Tennessee to adjust its footprint.

    Honda Motor faces a different dilemma. The carmaker is operating near full capacity across its North American plants and has evaluated site selection for a new assembly plant, but executive leadership paused commitments in August due to unresolved trade disputes between the United States and Canada under the USMCA trade agreement.

    Supplier Margins Squeezed by Policy Shifts

    Parts manufacturers and technology suppliers lack the balance-sheet flexibility of finished-vehicle assemblers. Investment by automotive component suppliers plunged from more than $8 billion in the first quarter of 2025 to roughly $600 million across the middle quarters of the year, according to figures compiled by the Center for Automotive Research.

    The supplier sector employs 930,000 workers in the United States and has absorbed substantial unrecovered tariff expenses. Survey data from MEMA, the Vehicle Suppliers Association, shows that nearly 80 percent of component vendors rank government trade policy changes as one of their four largest operational threats over the coming twelve months, alongside broader economic weakness and soft vehicle retail sales.

    The Long Cycle of Capital Allocation

    Automotive assembly investments require decades to deliver returns on capital, creating friction with short-term tariff revisions. Industry projections from Mobility Global indicate United States vehicle output will remain flat at 10 million units in 2026 before rising toward 11.3 million units by 2030 once major plant reconfigurations enter commercial service.

    Deloitte reports that component suppliers have recovered only half of their tariff-related cost burdens. In response, parts vendors are curtailing speculative capacity expansion and shifting capital budgets directly into factory automation and robotics to preserve operating margins.

    Employment Rebounds Below Previous Peak

    United States automotive manufacturing payrolls tracked by the Bureau of Labor Statistics stood at just under 1.8 million workers in September 2026. While that figure represents a gain of nearly 1 percent since January 2025, total sector employment remains more than 2 percent below the high recorded in July 2024.

    Automakers navigated policy reversals on electric vehicle incentives throughout 2025, which disrupted supplier tooling programs and forced factories to retool for internal combustion and hybrid powertrains. Carmakers are prioritizing the utilization of idle plant capacity over greenfield development until trade agreements reach stable terms.

    Attention now turns to the scheduled renegotiation milestones for the USMCA pact, where unresolved dispute resolution rules will determine whether Honda commits capital to a new North American assembly facility or diverts production to alternate international hubs.

  • Bangladesh Pushes Fruit Importers to Open Credit Lines as Orange Prices Hit Tk 520

    Bangladesh Pushes Fruit Importers to Open Credit Lines as Orange Prices Hit Tk 520

    Bangladesh Commerce Minister Khandakar Abdul Muktadir pressed fruit traders in Dhaka on Saturday to accelerate letters of credit for imported produce. The push aims to curb surging retail prices.

    Retail prices for imported sweet oranges, known locally as malta, climbed to Tk 520 per kilogram. That surge came despite regular landed costs and existing customs duty schedules. Muktadir met commercial traders and state regulatory bodies at the Secretariat to demand an explanation and outline immediate supply adjustments.

    Supply deficit triggers retail squeeze

    Traders blamed container shortfalls at maritime ports for the price spike. Weekly arrivals dropped to between 12 and 29 containers of sweet oranges. That falls far short of Bangladesh’s normal daily market consumption of roughly 15 containers.

    Importers reported that compounding logistics costs, port turnaround delays, and steep import taxes forced businesses to curb order volumes. Financial losses suffered on earlier shipments also discouraged merchants from booking high-volume consignments for perishable items carrying high spoilage risks.

    Muktadir instructed the Directorate of National Consumer Rights Protection to monitor retail markets and penalise vendors charging unjustified markups. He told traders the government will not tolerate speculative pricing on household fruit.

    Tariff reassessment for dates and fresh produce

    The Ministry of Commerce offered tariff relief to encourage fresh import financing through commercial banks. Muktadir pledged that the government will review the duty structure on sweet oranges. He also promised a formal decision on date duties and taxes within the week.

    Fruit importers raised concerns over shipping windows for dates ahead of seasonal consumption cycles. International transit hurdles require early tax clarity to avoid supply bottlenecks. Customs valuation disputes have also complicated date clearances at border checkpoints.

    A representative from the National Board of Revenue confirmed that actual purchase prices across different grades of dates vary widely. Customs assessments frequently fail to reflect those tiers accurately. The Bangladesh Trade and Tariff Commission plans to meet importers to determine realistic baseline prices verified against international source markets before submitting a revised schedule to revenue authorities.

    Supermarkets face inventory costs

    Grocery chains and retail fruit sellers across Dhaka and regional urban hubs face shrinking sales margins under the import bottleneck. When fruit consignments arrive at irregular intervals, procurement desks compete for scarce spot containers. That drives wholesale terminal auction prices upward before stock reaches store displays.

    Lowering duty barriers without ensuring commercial banks clear foreign exchange allocations for letters of credit will keep wholesale prices elevated. Traders must also identify alternative overseas agricultural suppliers quickly to rebuild port inventory pipeline volumes before winter consumption peaks.

    Regulatory scrutiny on staple food chains

    This pricing clash follows repeated government interventions across Bangladesh’s essential food supply chains over the past year. Authorities have maintained active price ceilings and import duty waivers on core commodities such as edible oil, onions, and sugar to counteract stubborn food inflation.

    Extending formal pricing reviews to imported table fruits reflects broader consumer pressure on non-staple grocery budgets. The commerce ministry is threatening enforcement actions through the consumer rights directorate while dangling duty concessions to push commercial trading houses toward voluntary price moderation.

    Importers agreed to explore alternative overseas sourcing destinations to diversify citrus procurement away from disrupted traditional routes. Next, the Bangladesh Trade and Tariff Commission must set its new valuation schedule for date consignments before revenue collectors implement the revised import framework.

  • Shein Net Revenue Rose 1 per Cent in First Report as Public Company

    Shein Net Revenue Rose 1 per Cent in First Report as Public Company

    Shein reported that its net revenue rose just 1 per cent year on year in its first earnings report as a public company, as rising shipping costs and changing customs rules squeezed profits.

    The fast-fashion retailer built its business on delivering cheap clothing to shoppers quickly, but the economics behind that promise have become harder to sustain while attempting to broaden its appeal without losing low prices.

    While orders and active customer numbers grew, retail advisor Deanna Andersen noted on October 1, 2026, that rules changed faster than Shein’s model could.

    Regional Sales Slump in Western Markets

    Western consumers pulled back sharply during the quarter as import rules tightened. Revenue across European markets dropped 13.9 per cent to $3.77 billion. In the United States, sales contracted 6 per cent to $2.5 billion. Growth across Latin America offset the Western downturn just enough to keep overall group revenue marginally above the prior year.

    Cross-border direct dispatch from Chinese factories made Shein a global retail power, but that direct-to-consumer logistics network is facing regulatory resistance. Customs authorities in North America, Europe and South Africa have tightened de minimis duty exemptions on small postal parcels. The introduction of handling fees and import duties immediately chips away at low-ticket transactions, forcing the company to decide between absorbing extra fees or hiking list prices.

    “The rules changed faster than Shein’s model could,” said advisor Deanna Andersen.

    The Limits of Centralised Air Freight

    For Asia-Pacific supply chains, the squeeze on Shein signals a forced restructuring of cross-border e-commerce. Chinese manufacturing networks configured solely for fast-turnaround, air-shipped parcels are losing their cost edge when border duties apply. Domestic apparel brands and established department store chains in regional markets are holding their ground against offshore competitors as price parity narrows.

    Rival platform Temu has also stepped up pressure by broadening its product catalogue beyond apparel into general merchandise and home goods. That rivalry has inflated digital advertising acquisition costs across search and social channels, compounding the margin decline for pure-play fashion sellers.

    Inventory Risk Shifts to Local Warehouses

    To bypass package-level border scrutiny and lower delivery times, cross-border sellers must move bulk inventory into regional warehouses closer to target consumers. Doing so breaks the core mechanism that made Shein profitable: producing tiny batches on demand with zero local inventory carrying cost.

    Bulk sea shipping and local distribution centres demand working capital and introduce markdown risk on unsold inventory. Passing higher freight and warehousing expenses onto shoppers risks alienating the core demographic that uses the app strictly for bargain pricing.

    Losses in Early 2026 Followed by Weak Rebound

    The margin contraction follows a difficult start to the financial year. Shein posted a net loss of $99 million in the first quarter of 2026, reversing a $395 million net profit recorded in the corresponding period of 2025. Although the business returned to positive net income in the second quarter, profitability remains far below historic performance.

    Investors now await third-quarter trade volume data and customs clearance metrics ahead of the peak year-end holiday shopping quarter.

  • Bangladesh Drugmakers See Little Gain from US 100% Tariff Exemption

    Bangladesh Drugmakers See Little Gain from US 100% Tariff Exemption

    Bangladesh’s pharmaceutical industry will see limited immediate export gains from a US tariff adjustment exempting specialty medicines, according to industry leaders including Shawkat Haider of Beximco Pharmaceuticals Limited.

    Under Section 232 of the Trade Expansion Act, the US announced a 100 percent ad valorem tariff on certain licensed pharmaceutical products and ingredients from September 29, while granting zero-tariff entry on selected specialty drugs to eligible jurisdictions.

    The zero-rate list covers rare-disease orphan drugs, nuclear medicines, plasma-derived therapies, fertility treatments, cell and gene therapies, and antibody-drug conjugates from approved partners including Bangladesh, India, Japan, and the European Union.

    The Manufacturing Gap

    Exemption on paper means little without production lines on the ground. Bangladesh built its drug export trade on generic small-molecule tablets, capsules and basic formulations rather than complex biologics.

    Commercial production of gene therapies or antibody-drug conjugates requires sterile cleanrooms, specialized bioreactors and years of clinical validation. Shawkat Haider, executive director of Beximco Pharmaceuticals Limited, confirmed the structural limitation facing domestic producers.

    “Bangladesh will not get any significant benefit from the tariff adjustment because we do not manufacture this type of highly sophisticated medicine,” Haider said.

    Regional Competition and Compliance

    Regional competitors hold a wide lead in the specialty segments covered by the US order. Contract manufacturers in South Korea and India already operate US Food and Drug Administration-cleared biologic plants. They supply licensed ingredients directly to North American distributors.

    Local producers attempting to enter these niches face steep capital costs and strict US regulatory audits. Domestic veterinary medicine manufacturers also lack the international certifications needed to clear US border inspections, leaving that market segment out of reach for now.

    Earlier Tariffs and Trade Timelines

    The revised pharmaceutical duties follow an earlier round of US trade enforcement under Section 232. Washington activated the first phase of 100 percent tariffs on July 31 for an initial annex of listed companies before widening enforcement to broader pharmaceutical categories on September 29.

    Industry lobby BAPI, the Bangladesh Association of Pharmaceutical Industries, is reviewing product lists to identify whether any existing formulation pipelines qualify under the zero-tariff rules. Abdul Muktadir, president of BAPI and chairman of Incepta Pharmaceuticals, said individual product assessments will determine if future export openings exist.

    What to Watch

    Dhaka drugmakers are reviewing capital expenditure plans for dedicated biotech and oncology plants to evaluate their long-term viability under US export specifications.

    Government trade officials are tracking whether the US Trade Representative adds conventional oral generic categories to future Section 232 exemption schedules before the next tariff review cycle opens in 2027.

  • Trump and Xi Summit in Washington Yields Limited Progress on Tariffs

    Trump and Xi Summit in Washington Yields Limited Progress on Tariffs

    President Donald Trump and Chinese leader Xi Jinping met in Washington last week for a summit that yielded limited progress on tariffs, leaving bilateral relations in what analysts describe as a managed stalemate.

    The limited outcomes showed how far apart Washington and Beijing remain on core economic issues, reinforcing analyst views that China sees little incentive to grant major political concessions ahead of November’s midterm elections.

    Limited Progress on Technology and Supply Chains

    Asia-Pacific supply chains face operations without clear visibility into 2027. Negotiators deferred binding settlements on critical trade disputes. These include China’s export limits on rare earth materials and US trade restrictions on advanced semiconductor shipments.

    Xi arrived in Washington seeking trade predictability as domestic retail spending softens in mainland China. Chinese factory exports have reached record levels globally. Still, falling residential property prices and persistent youth unemployment continue to depress household demand across tier-one and tier-two cities, where homeownership stands near 80 percent.

    Stalemate Over Tech Controls and Taiwan

    Artificial intelligence discussions ended without operational safeguards or a formal bilateral pact. Xi argued during the meetings that advanced computing systems must stay under direct human control. Meanwhile, the White House maintained its broader export controls on cutting-edge processors.

    Geopolitical friction also limited commercial progress. Xi reiterated that American arms sales to Taiwan cross a fundamental red line for Beijing, following a May warning that mishandling the territory could spark direct conflict. The US administration continues to hold a pending 14 billion dollar arms package for the island, using it during negotiations.

    What Operators and Exporters Face Next

    For consumer electronics makers, apparel brands and contract manufacturers across East Asia, the outcome changes little on the ground. Companies that accelerated factory shifts into Southeast Asia to dodge unilateral duties must continue carrying dual-supply chain overhead.

    Retailers sourcing consumer goods through southern Chinese hubs face an immediate cost risk early next year. The three-month extension merely pushes tariff uncertainty past the November US midterm elections without removing the threat of sudden duty hikes.

    January brings the next formal test for cross-border logistics and bilateral commerce, when the current tariff pause expires and working groups resume formal negotiations over market access and tech controls.

  • BYD Pushes European Production as Sales Reach 4.27 Million Units

    BYD Pushes European Production as Sales Reach 4.27 Million Units

    BYD delivered 4.27 million new energy vehicles last year, expanding its European footprint. The surge steps up competitive pressure on German automakers across their core regional markets.

    Total sales for 2024 rose 41 percent over the previous year. That growth gives the Shenzhen-based automaker added scale as it builds its first European assembly facility.

    Bypassing Tariffs in Hungary

    Construction is underway on a passenger car plant in Szeged, Hungary. Vehicles assembled there will be built inside the European Union rather than shipped from Chinese ports.

    Local assembly lets the carmaker bypass additional tariffs the European Commission imposed on battery electric vehicles imported from China. The Commission determined in 2024 that Chinese state subsidies harmed European producers, introducing penalties to offset pricing differences.

    The Szeged plant will create thousands of local jobs and source components through regional supply chains, establishing a domestic European operating base.

    Pressure on German Brands

    German automotive groups face mounting headwinds across their volume and luxury segments. Volkswagen, BMW and Mercedes-Benz built their global market presence on engineering standards and brand prestige, supported by specialist badges including Audi and Porsche.

    Sluggish domestic economic growth, persistent inflation and supply chain friction now squeeze profit margins across German operations. Lower production costs and rapid development cycles from Chinese competitors directly challenge those legacy advantages.

    Pricing pressure in electric passenger cars leaves legacy European manufacturers with narrow operating margins. Chinese competitors produce battery packs and vehicle software internally, cutting component costs below what German supply networks currently deliver.

    Policy and Market Headwinds

    Trade barriers alone offer limited protection for European carmakers once overseas competitors start manufacturing inside the trade bloc. European manufacturers must match competitive vehicle prices while investing heavily in software architecture and battery chemistry.

    The European Commission outlined these structural vulnerabilities in its 2025 automotive action plan. The report warned that European automakers risk falling behind international rivals in battery development, vehicle software systems and autonomous driving platforms.

    Brussels now pairs import duties with domestic manufacturing incentives. Factory investments by Chinese firms inside the trade bloc weaken that intended barrier.

    Expansion from 2022 Entry

    BYD formally entered the European passenger car market in 2022 before committing capital to the Hungarian production site. Economists compare the broader shift to the manufacturing trade integration seen after China joined the World Trade Organization in December 2001.

    German automakers must now defend market share across both electric sedans and compact sport utility vehicles as local assembly begins. The decisive metric will be the production start date at the Szeged plant and the final retail pricing of its Hungary-built models.

  • US and China Extend Trade Truce to Jan. 10 as Leaders Meet in Washington

    US and China Extend Trade Truce to Jan. 10 as Leaders Meet in Washington

    The United States and China have agreed to extend their bilateral trade truce through January 10, pushing back a deadline previously set for November 10 as heads of state opened their second summit of the year in Washington.

    US Treasury Secretary Scott Bessent confirmed he and Chinese Vice Premier He Lifeng agreed to the two-month extension, providing temporary relief as US President Donald Trump and Chinese President Xi Jinping hold talks amid lingering tensions over tariffs, rare earth materials and artificial intelligence.

    Carving Out Non-Strategic Goods

    Negotiators spent the run-up to the summit narrowing the range of products exposed to sudden tariff spikes. The Manhattan meetings produced an understanding to exempt nonsensitive consumer and industrial lines from future escalations, aiming to insulate everyday trade from broader geopolitical tensions.

    Bessent met with He Lifeng twice in four days to lock in the framework before official state ceremonies began at the White House. The Treasury stated that strategic stability between the two economies requires reciprocity, setting clear guardrails for subsequent negotiations covering specific import codes.

    Shifting Supply Chains and Agricultural Flows

    Prolonged tariff disputes have already redrawn key trade channels across the Pacific. American soybean shipments to China plunged from nearly $18 billion in 2022 to $3 billion in 2025, according to US Department of Agriculture data, reallocating massive bulk purchasing power to South American exporters.

    Brazil captured the bulk of that diverted demand, shipping a record 108.7 million metric tons of soybeans in 2025 with roughly 80 percent bound for Chinese processors. For Asian supply chain managers, the shift shows how quickly commodity and consumer product pipelines reroute when trade barriers persist beyond initial negotiation cycles.

    Manufacturing Strength Against Domestic Headwinds

    China enters the extended truce period holding a record trade surplus exceeding $1 trillion, maintaining its stronghold on global industrial exports despite years of Western tariff pressure. Factory output and technological adoption have accelerated across high-end manufacturing segments, expanding outward shipments to Southeast Asia and Latin America.

    Domestic retail conditions tell a different story. A protracted property downturn continues to constrain household spending across Chinese tier-one and tier-two cities, while youth unemployment stood at 18.9 percent in August. Retail operators in mainland hubs face cautious consumer sentiment, forcing domestic brands to look overseas for margin growth.

    Terms of the January Window

    Previous summit rounds in Beijing established the framework for dialogue, but commercial buyers spent recent months front-loading inventory to avoid scheduled tariff resets. Extending the deadline from November 10 to January 10 gives procurement teams a clear window to clear fourth-quarter holiday stock without sudden duty hikes.

    The next test comes as working teams draft the finalized list of nonsensitive product exemptions ahead of the January 10 expiry date. Importers, logistics carriers and retail buyers across Asia are tracking whether consumer tech accessories, apparel and packaged goods will make the permanent exemption schedule.

  • Pakistan Power Regulator Reviews Rs1.73 Electricity Tariff Hike for August

    Pakistan Power Regulator Reviews Rs1.73 Electricity Tariff Hike for August

    Pakistan’s power regulator is considering an electricity tariff increase of Rs1.73 per unit. The hike covers higher generation expenses incurred in August.

    The Central Power Purchasing Agency submitted the adjustment petition to the National Electric Power Regulatory Authority. It seeks to recover fuel expenses across state distribution companies and Karachi-based utility K-Electric.

    A public hearing is scheduled for September 29 to review the submission. If approved, the surcharge will apply to all standard consumer categories nationwide on upcoming billing cycles.

    Generation mix and fuel cost breakdown

    Data filed with the authority shows power producers supplied 14.464 billion units of electricity to distribution companies during August. Generation costs averaged Rs8.82 per unit across all energy sources.

    Hydropower remained the primary source, generating 37.84 per cent of total electricity. Coal also carried a heavy load. Imported coal accounted for 15.59 per cent of total output, while domestic coal delivered 10.88 per cent.

    Costly thermal generation pushed up the overall fuel basket despite low volumes. Imported liquefied natural gas supplied 8.48 per cent of power at Rs45.92 per unit. Furnace oil accounted for 2.15 per cent of supply at Rs45.25 per unit. Domestic natural gas provided 7.04 per cent of output.

    Operating margin pressures on commercial operators

    Continuous fuel cost adjustments push up utility overheads for store operators, cold-chain logistics providers, and shopping centre managers. Power is one of the largest non-payroll operating costs for commercial occupiers in urban retail hubs.

    Commercial tenants cannot absorb recurring adjustments without passing increases along supply chains or cutting floor energy use. Higher baseline tariffs squeeze margins. The pressure falls hardest on grocers running continuous refrigeration networks and department stores maintaining heavy air conditioning loads.

    Consumer purchasing power faces fresh headwinds

    Household budgets contract as higher utility bills reduce discretionary retail spending across major metropolitan centres. Rising power bills immediately drain middle-income disposable wages.

    Shoppers respond by delaying purchases of discretionary goods, apparel, and major home appliances. For mass-market brands in Pakistan, this pull-back reduces foot traffic and shrinks basket sizes during off-peak periods.

    Previous regulatory adjustments

    This petition follows a separate adjustment approved last month, which added Rs0.7503 per unit to August consumer bills for power consumed in June. That adjustment carried an aggregate financial impact of Rs9.8 billion nationwide.

    Regulators applied the June charges to K-Electric consumers and all distribution companies under the former Water and Power Development Authority framework. Lifeline customers, electric vehicle charging stations, and pre-paid meter accounts were excluded.

    Final surcharge rates for upcoming commercial and residential bills will be decided at the September 29 determination hearing.