Talking Dollars & Making Sense: The Trade Policy Showdown – U.S. Tariffs vs. China’s Dumping in Guyana

Talking Dollars & Making Sense

The Trade Policy Showdown – U.S. Tariffs vs. China’s Dumping in Guyana

by

Rennie Parris, MBA

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Welcome back to Talking Dollars & Making Sense. Today, we’re diving into the complicated world of international trade—specifically, how recent U.S. tariff policies and China’s dumping practices are impacting Guyana. Let’s unpack what these policies mean for our local businesses and the broader economy.

To understand why China’s trade approach is creating such disruption, we need to examine its internal challenges. China is currently grappling with a trio of economic issues: a consumption slump, a real estate collapse, and massive overproduction. The 2020 collapse of the Chinese real estate market wiped out significant household wealth, and since then, Chinese consumers have become far more cautious, favoring saving over spending.

Even five years later, domestic consumption remains well below pre-pandemic levels. With demand down at home, China has found itself with vast surpluses of goods—from inexpensive everyday items to luxury products.

To counteract this slowdown, China has turned to exports. Today, exports make up roughly 20% of China’s $19 trillion GDP, contributing to a trade surplus exceeding $1 trillion. The strategy is straightforward: move excess inventory by flooding foreign markets with goods at prices far lower than local competitors can match. But it doesn’t stop there. China also lends money to countries like Guyana for development projects, often stipulating that Chinese workers be hired—exporting both goods and labor. State subsidies keep prices artificially low, and governments from Indonesia and Brazil to Canada and India have accused China of dumping—selling products below market value to gain unfair advantages.

In Guyana, the impact is real and painful. Local businesses are struggling to compete with these deeply underpriced imports. For consumers, it may feel like a temporary win—cheaper goods on the shelves—but the long-term consequences are stark. When local companies shut down or scale back, jobs are lost, industries shrink, and national economic resilience weakens.

Many Guyanese entrepreneurs have already been forced to close or significantly reduce operations. They are calling on the government to intervene, citing global precedents in anti-dumping measures. Yet to date, no action has been taken to shield our domestic industries.

Other countries offer clear models. Indonesia banned the Chinese e-commerce giant TEMU. Brazil and Argentina, among others, imposed steep tariffs on Chinese steel, textiles, electronics, and more. The European Union and the United States have adopted similar tactics. These protective policies aim not to block competition, but to ensure that it is fair—and that local industries have room to thrive.

Guyana would do well to follow suit. Even as initiatives like the gas-to-shore project promise cheaper energy and enhanced manufacturing potential, our local producers will not survive unless we act to level the playing field against heavily subsidized imports.

At the same time, U.S. tariff policy also deserves scrutiny. Under the Trump administration, the U.S. imposed sweeping global tariffs aimed at correcting trade imbalances. Though not targeted specifically at Guyana, the consequences have been felt. In 2024, Guyana exported about $5.5 billion—mostly oil—to the United States, while importing only $1.3 billion. This left Guyana with a $4.2 billion trade surplus. On this basis, the U.S. applied a 38% tariff rate to Guyanese exports—though oil, which makes up nearly 90% of our exports, was exempted.

This exemption, however, highlights an odd irony: our trade surplus, driven by oil, triggered tariffs that impact non-oil exports. Firms like DDL, Banks DIH, and food manufacturers could face new costs—not because of their own market performance, but due to broad-based U.S. trade metrics.

Thankfully, many of these businesses are not heavily reliant on the U.S. market, minimizing the short-term damage. But the long-term uncertainty caused by these tariffs complicates operations and raises costs.

Beyond our borders, the broader risk is a global economic slowdown. History provides cautionary tales—most notably the 1930 Smoot-Hawley Tariff Act, which worsened the Great Depression. If global trade tensions escalate, oil prices could drop dramatically. We’ve already seen Brent crude dip to $65 per barrel, a troubling sign for Guyana, whose fiscal health remains tightly tethered to petroleum revenue. A global recession would severely hamper non-oil sectors and further destabilize the economy.

Both Chinese dumping and U.S. tariffs pose significant challenges. China’s actions threaten the foundations of our domestic economy by undercutting local producers. U.S. tariffs, meanwhile, strain our export capacity and create macroeconomic uncertainty. The risks are different, but equally serious.

In response, the Guyanese government must act with urgency and focus. Implementing anti-dumping duties on Chinese imports would send a clear message: our local businesses matter. We should draw on the experiences of countries like Canada, India, and Brazil to design a strategy that protects our interests without isolating us from global trade.

As for the United States, retaliation through reciprocal tariffs would likely do more harm than good. A smarter approach would be diplomatic engagement. Emphasizing Guyana’s role in supporting U.S. energy goals—especially through ExxonMobil and Hess—could help make the case for revised trade terms. Guyana’s surplus with the U.S. is primarily due to oil, and that oil flows back into the U.S. economy. Clarifying this interdependence is essential.

Additionally, Guyana must take real steps toward economic diversification. Relying solely on oil is unsustainable. Supporting local manufacturing, encouraging entrepreneurship, and building strategic trade alliances will be key to weathering future disruptions.

At the end of the day, understanding trade policy isn’t just for economists—it affects all of us. Guyana stands at a crossroads. The decisions made now will determine whether our economy thrives in the face of global change or falters under its weight.

Let’s stay engaged, stay informed, and continue to demand policies that reflect the best interests of all Guyanese. Until next time, keep thinking critically—and keep talking dollars and making sense.

Rennie Parris, MBA, is a Guyanese economist and business strategist with expertise in trade policy, economic development, and regional competitiveness. He holds an MBA in Finance from the Wharton School of Business and has served in private and public sector advisory roles. Parris regularly contributes to the Guyana Business Journal, where he writes on trade, investment, and economic policy issues impacting Guyana and the wider Caribbean.