Shrimp Tariffs: Who Gains and Who Loses Essay

Submitted By chicossj5
Words: 775
Pages: 4

Julio Hidalgo
ECON312
Instructor: Jamison Bowman
Shrimp Tariffs: Who Gains and Who Loses Essay

Tariffs on shrimp imports? Who were the ones that were going to win out of it and who were the ones that had a lot to loose? It was a very close call when the U.S. International Trade Commission, announced a proposed tariff on all shrimp importing around mid year of 2004. The main targeting countries for this proposal with the tariffs were none other than China, Vietnam, Thailand, India, Brazil, and Ecuador. These six countries account for the lion’s share of imported shrimp. Of the 1 billion pounds of shrimp consumed annually in the United States, about 87 percent is imported from these countries (works cited-3). The tariffs that were being placed on each of the six countries were going to be varied depending on the financial information that was being provided to the Commerce Department for each country.

But why the sudden decision on placing these tariffs? Well the main and principal reason why these tariffs were going to be enforced was because China and Vietnam were named in an anti-dumping petition that was filed in late December of 2004 from the Southern Shrimp Alliance (works cited-1). This was a group of U.S. shrimp processors and boat owners that complained that their overseas rivals were driving prices on shrimp so low that U.S. companies couldn’t compete with at all. That is why these tariffs are mainly taxes paid by the buyer of the imported product, makes the price higher for that item in the country that imported. Therefore, effectively restricting the imports. This relates to TCO 8 which addresses barriers to trade because tariffs are a common way of restricting imports and putting regulation on international trade. Tariffs will protect the domestic shrimp industry in the U.S. and achieve a favorable balance of trade- that is, to have more goods exported than imported. This was the goal that the U.S. was trying to achieve.

So who are the ones the gains & looses? One thing that is for sure, that the taxes collected on the imported shrimp increases revenues for the nation’s government. So guess where the revenues from those tariffs will go? Directly into the pocket of the U.S. shrimp industry. So it’s clear that they are the ones gaining from all this. The consumers are the ones loosing on the game play. Its true, any tariff the U.S. pay on shrimp will ultimately be passed on to the consumer as a higher price, whether is a 2 or 3 percent increase in which case the consumer wouldn’t even notice the change anyhow(works cited-3). Also, restaurant businesses would be the most harmed by the proposal because the duties would drive up prices and potentially discourage customers from ordering shrimp dishes anymore (work cited-2). Shrimp is no longer considered a luxury food item today in all restaurants. But if the tariffs were to be enforced on the imported shrimps, then this will surely lead to shrimp being compared to the lobster as a delicacy for the…