Insights
International Courier
Global Courier
18 April 2019

Trade Zones & Tariffs: How a Global Courier Assists with International Logistics

Shipping materials and goods internationally can be complicated in the best of times. In today’s political climate, with tariffs, trade zones, and free trade agreements in the news almost daily, it can be even more challenging, especially for the manufacturing industry that now has a truly global supply chain.

At CNW, we get questions from our clients around the world about how to navigate the tricky routes between tariffs, duties, and taxes imposed by various countries. Will re-routing a shipment be worth it? How can they avoid delays or a 25% tariff on certain materials?

Global Couriers Provide Expertise

If you’ve been importing and exporting products around the globe, you likely already know how important it is to work with a trusted international courier, rather than with a typical freight forwarder. CNW is constantly working with tax lawyers and customs officials worldwide in order to provide the best solutions and information to our customers. This way, we are able to clear and move shipments across borders as quickly as possible—and offer cost-effective global courier services.

An excellent global courier should also have strong relationships with trusted, reliable logistics partners. We have carefully selected our logistics partners and know that they will work with us when we need to come up with proactive, creative shipping solutions.

Workarounds for Tariffs on Chinese Imports

Although negotiations on tariffs between the United States and China are ongoing, we have already helped clients find workarounds. Previously, it was common for a company to, for example, import raw goods or unfinished materials from China. A freighter would take them to a US port, but the raw goods would then be transported to the company’s manufacturing facility in Mexico for fabrication and assembly. As long as the finished goods were ultimately sold in the US, the company wouldn’t have to pay import or customs duties on the materials brought from China. But with the new tariffs, for many companies and industries, that is no longer the case.

As soon as these tariffs were put in place, global courier services started working with their clients and logistics partners to figure out workarounds, such as different shipping routes or shipping through bonded warehouses.

Mexico’s New Border Free Trade Zone

More recently, the new president of Mexico announced a new Border Free Trade Zone, which extends along the full length of the US/Mexico border and includes major manufacturing centers like Tijuana and Cuidad Juarez. The trade zone is supposed to be the largest in the world and could have benefits for the US market. For example, companies that operate in the free trade zone can increase their cash flow from “immediately” deferring the payments of U.S. duties and tariffs.

There are also logistics advantages: a company can file a single customs entry for the entire week’s shipments, saving on paperwork and processing time and costs. By working under the benefit of a FTZ, companies can be more competitive with firms operating offshores or overseas. They save a significant amount of money and time because there are no customs inspections in the border and duties to be paid during this portion of the supply chain.

Learn more about how CNW’s international courier services can help you in any shipping situation. Contact us today.