NORFOLK, Va. — The ongoing tariff discussions during President Trump's first 100 days in office are poised to potentially affect the Hampton Roads economy well beyond consumer prices.
Economists and businesses linked to local ports are preparing for significant challenges.
"We have tariffs and we have uncertainty, and when you mix the two, you have volatility," said Dr. Bob McNab, chair of the economics department at Norfolk's Old Dominion University.
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His office is located near the bustling Port of Virginia, a key economic driver for the region.
"We don't know what the ultimate impact of tariffs will be to the port, which accounts for tens of thousands of jobs across the Commonwealth," McNab added.
McNab predicts the impact would not just be felt on a large scale; everyday consumers may soon notice the effects as well.
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"If you start reducing the supplies coming into the United States in two or three months, it's going to manifest in shortages on the shelves," McNab warned.
He is already witnessing the repercussions on trade, as U.S. imports dropped 64% in early April compared to the last week of March.
"Remember the spring of 2020 when people couldn't find toilet paper? Now imagine we face a two-thirds decline in imports from China: electronics, cars, toys, everything," McNab said.
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This decline could lead to increased prices for consumers and challenges for businesses reliant on port activity. Rachel Shames, a vice president with CV International, a global shipment coordination company, noted the potential for shifts in trade origins, but acknowledged that the decrease in Chinese freight might balance out overall trade volumes.
"I think there could be a boost from the other origins, but with the China freight being down, it could end up being a wash," Shames stated.
Shames emphasized the extent of the impact on ports will largely depend on how long businesses can handle the increased costs associated with tariffs.
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"Long term, I think as long as these tariffs are in play, especially these extremely high tariffs, it's certainly likely there will be some lower volumes coming through ports," she said.
There may be potential relief on the horizon, as President Trump has recently indicated a willingness to soften the 145% tariffs on China, although no definitive changes have been announced. Time remains a critical factor, according to McNab.
"It would be extremely disruptive, not only to the port, but the local economy as well," he said.
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