Hong Kong suspends US parcel shipments amid Trump's tariff hike plans

Chinese city's says it will suspend all goods mail services to the US in response to Trump's 'unreasonable and bullying action' of imposing 120% tariff on small-value parcels

Hong Kong said on Wednesday it is suspending parcel shipments to the United States (US), reacting after Washington revealed plans to impose tariffs on small-value shipments from the southern Chinese city.

 

President Donal Trump’s administration has said it will end a customs exemption that previously allowed small-value parcels from Hong Kong to enter the US without being taxed. A new policy, effective May 2, will impose a 120 per cent tariff on such shipments. Under the existing "de minimis" exemption, parcels valued under $800 could enter the US without incurring taxes.

 

In response to the US decision, a statement from the Hong Kong government indicated that the Hong Kong Post would no longer collect tariffs on behalf of Washington. The statement also announced that it would suspend the acceptance of non-airmail parcels containing goods intended for the US. Airmail parcels will continue to be accepted until April 27, according to the government.

 

“The public in Hong Kong should be ready to pay exorbitant and unjust fees for sending items to the US due to the US's unreasonable and bullying actions,” the statement read.

 

However, Hong Kong authorities clarified that mail containing only documents will still be accepted. Despite its status as a free port, Hong Kong has found itself in the midst of the trade conflict between the US and China, as its trade and customs policies differ from those of mainland China, thanks to its semi-autonomy granted during the 1997 handover.

 

After Beijing imposed a national security law in 2020, Washington began treating Hong Kong as part of China and applied the 145 per cent tariffs imposed on Chinese goods.

 

Trump's tariffs

 

On April 2, Trump unveiled a major escalation in US trade protectionism by announcing new, broad reciprocal tariffs. Referring to the day as "Liberation Day", Trump signed an executive order that imposed a minimum 10 percent tariff on all US imports, starting April 5. The move was framed as a response to persistent trade imbalances and a step towards safeguarding American manufacturing. While the 10 percent tariff applied to most countries, Trump imposed significantly higher rates on nations with which the US had large trade deficits, with China being the primary target. However, Trump announced a 90-day pause on tariff hikes for major trading nations, including India, but excluded China.

 

The tariff conflict between the US and China has intensified. Initially, the US increased tariffs on Chinese imports to 54 per cent. However, after a series of retaliatory actions, the tariff rate skyrocketed to 145 per cent by mid-April. In retaliation, China raised tariffs on American products to 125 per cent and introduced additional export restrictions, particularly on critical rare earth materials.

 

(With AP inputs)