Will Trump’s Tariff Deal Tilt the Playing Field Back Toward China?

For Travis McMaster, the general manager of Cocoon USA, an outdoor and travel brand, ordering products from his foreign suppliers this year has been a lot like gambling.

After reading the news of a trade truce between the United States and China last week, Mr. McMaster was relieved to have finally gotten a win. He estimated that President Trump’s decision to lower tariffs on Chinese products would save him roughly $30,000 in tariff costs on a shipment the company has coming in from China this week — enough to perhaps hire another seasonal employee in the small Washington town where Cocoon is based.

But the tariff deal came with a downside. Cocoon had begun shifting some production to India this spring to avoid high tariffs on China. But in the past few months, Mr. Trump has raised tariffs on India by 50 percent, while dropping tariffs on Cocoon’s Chinese goods to 30 percent, scrambling the company’s plans.

Mr. McMaster lamented the time he had spent on building up production in India. At least for the time being, he said, “I’m not going to spend any more energy trying to get out of China.”

After a chaotic year of tariff threats and trade deals, the United States has landed, at least temporarily, in a surprising situation. In the face of a potentially devastating trade clash with China, Mr. Trump agreed to cut in half a 20 percent tariff he had used to punish China for its role in the flow of fentanyl.

That has pared back U.S. tariffs on certain Chinese products to levels that are nominally near or sometimes below those he has put on products from other countries, including some allies like Switzerland, India, Brazil and Canada. According to calculations by the Yale Budget Lab, the average effective tariff on Chinese goods has risen by 20.2 percentage points this year, compared with 17.3 percentage points for the rest of the world.