San Diego’s business landscape is currently grappling with significant economic uncertainty, largely due to the impact of President Donald Trump’s ongoing trade war with China and other nations.
Nicholas Tran, co-owner of Vien Dong supermarket, describes how his family’s business has been adversely affected by months of fluctuating import prices.
Tran’s father established the first Vien Dong supermarket in 1981, driven by a growing demand from immigrant communities in San Diego for authentic food products from their home countries.
“The closest thing you can have for connection is food,” Tran explained.
He emphasized the importance of having access to familiar brands, saying, “It doesn’t have to be the same brand, and that’s key, but you gotta have it. But if you can get the same brand as in their own country, that makes it even more special.”
However, the last six months have seen import prices spiral, complicated by tariffs levied during Trump’s presidency.
As the U.S. awaits the outcomes of new trade negotiations announced by President Trump, an appeals court has recently ruled that tariffs on most U.S. trading partners can continue to be enforced while the legality of these tariffs is being assessed in courts.
These developments present further challenges for San Diego’s businesses, already strained under the weight of economic unpredictability.
“We spend hours every day on how are we gonna play this?” Tran stated, highlighting the difficulties inherent in running a supermarket where profit margins are already slim.
The expanded Vien Dong supermarket, along with the World Foods Supermarket, remains a family-owned operation in San Diego’s Colina del Sol neighborhood.
Both stores pride themselves on offering a diverse range of imported grocery products, particularly from Southeast Asia and China.
In his recent communications, President Trump claimed to have reached a deal with China concerning trade after talks in London.
He announced this on the Truth Social platform, where he indicated that the agreement would include a significant 55% tariff on Chinese goods entering the United States, alongside a 10% tariff on U.S. imports to China.
This damaging tariff structure encompasses 25% from Trump’s initial term, an additional 10% on imports from most U.S. trading partners, and reflects punitive measures related to China failing to curb the flow of fentanyl into the U.S.
Tariffs serve as a tax on imported goods, leading to increased costs for businesses and, ultimately, consumers.
The outlined trade deal may alleviate China’s ban on sending vital rare earth minerals to the U.S., which are crucial for producing various technological products, while facilitating the admission of Chinese students to U.S. universities in exchange.
If finalized, this agreement holds the potential to stabilize a trade environment that has been tumultuous for months due to unpredictable tariffs, impacting regional businesses heavily.
A spokesperson from the San Diego Regional Chamber of Commerce expressed cautious optimism over the developments, emphasizing that a stable tariff environment is essential for economic growth.
They highlighted that local manufacturers rely on raw materials that cannot be easily supplanted, warning that sudden changes could lead to significant cost increases and disrupt supply chains.
Businesses like Tran’s noticed a surge in consumer purchasing when tariffs were first implemented in April, comparing the frenzy to the toilet paper shortage experienced during the COVID-19 pandemic.
Since then, however, customer urgency has subsided, leading to a return to previous purchasing patterns.
Some authentic Chinese products, like Lee Kum Kee Oyster sauce and Viet Huong fish sauce, remain viable despite price increases, but Tran has actively sought alternative sources from other countries for certain items.
“China’s not the only country that has bamboo shoots. You can get it from Thailand, you can get it from Vietnam, you can get it from other countries,” he noted.
His vendors are adapting; many have begun processing goods in nations like India and Bangladesh, responding proactively to the shifting climate of international trade.
Tran is unsure about the longevity of tariffs on Chinese products and questions how long elevated prices could hold consumer loyalty to these brands before shifting their preferences to alternatives.
While most of his international vendors have managed to keep price hikes around 10%, some imports from countries like Vietnam are facing tariffs as high as 46%.
He speculates that tariffs might eventually settle at around 10% as negotiations unfold.
Reilly Stephens, a senior counsel at the Liberty Justice Center, has been vocal about the legal ramifications of the tariffs.
The Texas-based firm is representing several small businesses in a lawsuit against the Trump administration, which highlighted the contention that the president lacks the unilateral authority to impose tariffs— a power that resides with Congress.
The firm invoked the International Emergency Economic Powers Act to contest these tariffs, with other state attorneys general filing similar lawsuits alleging the tariffs were unfairly imposed.
Earlier in May, the U.S. Court of International Trade ruled unanimously that the tariffs in question were unlawful and paused their enforcement.
The Trump administration is appealing this ruling, and a federal appeals court has reinstated the tariffs for the time being while awaiting a final decision through the legal system.
“It’s not just the amount of the tariffs or the countries they’re on, but the unpredictability has stifled business planning significantly,” Stephens remarked.
He elaborated on how rapidly changing tariffs add layers of uncertainty, complicating the logistics of importing goods which requires meticulous advance planning.
A decision from the appellate court on this issue is anticipated in August, with an expectation that whatever the outcome, further appeals will follow.
Ultimately, the core issue rests with the authority held by the president in imposing tariffs as a unilateral executive decision rather than through the legislative process.
As this situation continues to evolve, businesses across San Diego remain steadfast, adapting to the challenges posed by the ongoing trade war and seeking pathways toward economic stability.
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