TYLER, Texas (KLTV) - The latest rounds on tariffs on Chinese imports is expected to impact consumers as they shop for products like cell phones and furniture.
GMET’s Brennon Gurley spoke with an East Texas economist about this will effect consumers and local business owners.
As the trade war with China unravels, China announced earlier this month plans to fight back with increased tariffs on $60 billion of U.S. goods.
“It’s going to have some kind of a negative or dampening impact on decision for the business community,” explains Tom Mullins, President/ CEO, Tyler Economic Development Council.
If consumers start to change how they spend their money, Mullins says the result could slow down the economy.“These kinds of conflicts, these kinds of competitions I can get people nervous and if they get nervous they stop spending,” adds Mullins.
Mullins says consumers will end up praying the price
“Whether it’s a piece of furniture, or whether it’s an iPad, or whether it’s a steel building that somebody wants to construct. If there’s a tariff on it that cost of that tariff is going to be added to the cost of the product,” explains Mullins.
The president’s 25 percent trade tariff will force consumers to make tougher choices.
“The doubt is discouraging. When people don’t know how it’s going to go, they tend to hold back, they tend to say I’m not going to make that purchase right now,” says Mullins.
Scott Melius is the owner of Southside Furniture in Tyler. He is feeling the pinch from the trade war and says if you were planning on buying some new furniture anytime soon, you will be feeling it too.
“On top of freight that's charged already they will charge the tariff which the company's will charge to the stores like us which in turn raise prices on some of the furniture,” explains Melius.
Melius says he has no choice but to raise prices.
“It worries us if prices must go up because we don’t want to get priced out of people coming in and buying furniture,” adds Melius.
About 20 percent of the products sold at Southside is imported from China.
“Any price change, any price increase we don’t want that. In retail price increase makes people not want to come in,” says Melius.
Mullins hopes that both leaders of the U.S. and China can come to some sort of agreement so it won’t trickle down to the consumers.
“I’m just hoping that we can come to a quick resolution and that trade corridors remain open, and that people can remain competitive and be able to get goods and services at prices that are affordable.
China announced that it will increase tariffs in the U.S. by the June 1.