Navigating the US-China Trade Winds: Opportunities & Strategies

Adapting Jewelry Supply Chains for Growth in a Shifting Global Landscape

Slide 1: The US-China Trade War: A Jewelry Industry Overview

Understanding Impacts and Challenges in the Jewelry Sector

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• Section 301 Impact: Since 2018, US Section 301 has disrupted global supply chains. Hong Kong's jewelry exports to the US face tariffs, especially on China-made products, adding 7.5% initially.
• Honeymoon Period Ends: From 2018 to January 2025, HK-made jewelry enjoyed a tariff-free period. However, new tariffs starting February 4, 2025, introduced a 5.5% + 20% levy.
• Supply Chain Shifts: Manufacturers are reorganizing supply chains, moving production to Thailand and India to avoid tariffs, impacting Hong Kong's re-export volume significantly.
• Hong Kong's Response: Local companies are focusing on high-end customized jewelry and setting up overseas offices to maintain market share and explore non-US markets like ASEAN.

Slide 2: China +1 Strategy: Benefits & Risks in Thailand

Exploring Thailand as an Alternative Manufacturing Hub

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• Tariff Avoidance: Moving production to Thailand can circumvent the 34% tariffs on Chinese goods. Thailand may still qualify for duty-free entry.
• Government Incentives: Thailand's Eastern Economic Corridor (EEC) offers tax breaks and infrastructure support, reducing setup costs and easing regulatory hurdles for manufacturers.
• Supply Chain Diversification: Reducing reliance on China mitigates risks from geopolitical tensions. Thailand's location provides access to ASEAN markets, reducing reliance on single markets.
• Potential Tariff Exposure: The U.S. imposed a 36% tariff on Thai goods which could negate cost savings. Relocating production requires time and investment and could have disruptions.

Slide 3: Thailand's Economic Outlook: US Tariffs Impact

Analyzing the Effects of US Tariffs on Thailand's Growth

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• Growth Reduction: In April 2025, Thailand's finance minister indicated U.S. tariffs could reduce economic growth by 1 percentage point, affecting export revenues and economic health.
• Government Response: Thailand aims to maintain exports by importing more U.S. goods, removing tariffs on some U.S. products, and addressing non-tariff barriers to the US.
• Strategic Adjustments: Thailand is strategically adjusting trade policies to counter the impact of U.S. tariffs, seeking balanced trade relationships to support sustained economic growth.
• Export Focus: Thailand focuses on export strategies, including tariff adjustments and barrier reductions, to minimize tariff impacts and sustain export levels amid trade tensions.

Slide 4: Thailand Cost Analysis: Setting Up Shop

Understanding Initial and Ongoing Operational Costs in Thailand

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• Initial Investment: Company registration costs range from $170–$280, with minimum capital requirements. Legal and consultancy fees for registration are around $280–$700.
• Operational Expenses: Monthly salaries average $980 per employee. Accounting services cost $1400 a month, and social security is $21 per month per employee, which impact operational costs.
• Tax Implications: Corporate income tax is 20% on net profits, and VAT is 7% on revenue exceeding $50,000 per year, affecting financial management strategies.
• Compliance & Auditing: Annual audits range from $560–$1,400, with licensing renewals adding additional expenses. Compliance and auditing are key aspects of financial strategy.

Slide 5: Hong Kong Jewelry Exports: 2021-2023

Analyzing Hong Kong's Jewelry Export Performance

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• Industry Performance: Evaluate Hong Kong's jewelry exports for the period of 2021-2023 and examine the key performance indicators for market growth.
• Market Trends: Identify prevailing trends in Hong Kong's jewelry exports over recent years, and understand the changing consumer preferences.
• Trade Dynamics: Analyze the underlying dynamics shaping Hong Kong's jewelry trade, providing insights into competitive advantages and potential challenges.
• Growth Opportunities: Explore new avenues for growth in Hong Kong's jewelry export industry, with a focus on innovation, customization, and market diversification.

Slide 6: US Trade Data (All Products)

Additional information for trading all products.

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• US Imports: Review current trends in overall US imports, focusing on key industries.
• US Exports: Assess the latest data on US exports, with emphasis on major export categories and destinations.
• Trade Balance: Examine the trade balance between the US and its trading partners, highlighting trade surpluses and deficits.
• Policy Impact: Assess the impact of US trade policies and agreements on the flow of goods and services across international borders.

Slide 7: Alternative Trade Hubs

Exploring Oman, Singapore, and the UAE as Strategic Locations

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• Oman's Trade Advantages: Examine Oman's strategic geographic location, free trade zones, and trade agreements and how these contribute to facilitating regional and global trade.
• Singapore's Hub Status: Explore Singapore's role as a key trade hub in Asia, and it's advanced infrastructure and regulatory environment to ensure seamless trade operations.
• UAE Trade Potential: Review the rising significance of the UAE, particularly Dubai, as a trade hub connecting the East and West, to provide a strategic location for transit.
• Waiting List Dubai: Highlight ongoing plans and projects in Dubai to expand trade infrastructure and streamline trade processes, to explore potential partnerships in UAE.

Slide 8: Oman

Highlighting the benefits of oman

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• Political Stability: Highlight Oman's stable political environment, providing assurance for businesses engaging in long-term investment and trade.
• Free Trade Zones: Examine the role of Oman's free trade zones in attracting foreign direct investment, streamlining business operations, and providing tax incentives.
• Strategic Location: Emphasize Oman's strategic location along major shipping routes and its access to key markets in the Middle East, Africa, and Asia.
• Infrastructure Development: Review the ongoing infrastructure development projects in Oman, including ports, airports, and transportation networks, facilitating trade connections.

Slide 9: Singapore

Highlighting the benefits of Singapore

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• Advanced Logistics: Review Singapore's advanced logistics infrastructure, including its world-class port facilities, efficient customs procedures, and seamless connectivity.
• Regulatory Environment: Explore Singapore's transparent and business-friendly regulatory environment, providing legal certainty, intellectual property protection, and efficient dispute resolution mechanisms.
• Financial Hub: Emphasize Singapore's status as a leading financial center, offering access to capital markets, investment services, and financial expertise to support trade.
• Skilled Workforce: Explore Singapore's highly skilled and multilingual workforce, providing talent for trade operations, supply chain management, and international business development.

Slide 10: Thank You

Thank You

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• Thank You: We appreciate your time and attention in considering our strategic insights. We look forward to collaborating with you on future endeavors.
• Contact Us: For further inquiries or collaboration opportunities, please feel free to reach out to us. We are here to assist you in navigating the complexities of global trade.
• Partnership: Let's partner in navigating the complexities of the US-China trade war and unlocking new opportunities for growth and success in the jewelry industry.
• Future Endeavors: We are excited about the prospect of future collaborations and partnerships. Thank you once again for your consideration and support.