How Trump’s Trade War Could Boost Slow Fashion

Not many businesses seem happy about President Donald Trump’s global trade war, which has roiled markets and threatens to lead the U.S. into recession. But there is one potential winner of his so-called “Liberation Day” last week: slow fashion.

Slow fashion is a movement pushing for an environmentally sustainable, ethically-produced approach to retail, emphasizing, for example, secondhand shopping. It’s “a different approach in which designers, buyers, retailers and consumers are more aware of the impacts of products on workers, communities and ecosystems,” wrote Kate Fletcher for the Ecologist in 2007.

But slow fashion has traditionally been dwarfed by fast fashion, which emphasizes quantity over quality—the Ellen MacArthur Foundation projected that clothing production would reach 160 million tonnes in 2050, triple that of 2017, while more than 40% of Gen Z consumers shop at companies like Shein and Temu, and more than a third shop monthly from TikTok Shop, which prioritize low production costs and quick shipping to dominate the market with cheap items that don’t always last long.

The fast fashion industry, however, was hit hard on April 2, not just by Trump’s “reciprocal” tariffs—which added an additional 34% import levy on Chinese goods, on top of the preexisting 20% levy—but more crucially by an executive order he signed the same day.

In eliminating the “de minimis exemption” on goods from China and Hong Kong, effective May 2, the U.S. is closing a customs “loophole” that has allowed companies like Shein and Temu to send millions of packages a day to the U.S., duty free. The “de minimis exemption” exempted from customs declarations and duties small packages—valued at $800 or less—that were shipped directly to consumers. It’s been used at a massive scale in recent years: The number of small, duty-free shipments from China increased by 1,145% from 2018 to 2023, according to the Congressional Research Service.

Read More: The Tax Loophole That Helps Temu and Shein Keep Prices So Low

The de minimis exemption fuels what slow-fashion resale companies say is their biggest obstacle to wider adoption by consumers: the ease and affordability of fast fashion.

“The biggest thing we [resale companies] have in common is we see fast fashion—generally low-price, low-quality items with a negative impact on the environment—as our competition,” CEO of online secondhand store GoodwillFinds Matt Kaness told Glossy, a beauty, fashion and wellness industry publication.

But now they may have a leg up on their competition.

Resale companies are relatively “insulated” from the wider Trump tariffs, advisor at Venturen and former Goldman Sachs analyst Luca Cipiccia wrote on LinkedIn. That’s because they don’t rely on global supply chains for product sourcing. Alon Rotem, chief strategy officer and general counsel at California-based resale company ThredUp, which sells secondhand clothing and accessories told sustainability media group Trellis: “If you think about ThredUp’s supply chain, all of the clothes we sell come from the closets of Americans.”

While shares of most retail companies plummeted after Trump announced that key production hubs China, Vietnam, Cambodia, Indonesia, and Bangladesh would be hit with hefty tariffs—the SPDR S&P Retail ETF fell 8% last Thursday; Nike, Adidas, Lululemon, H&M, Amazon, and Target all saw their shares slide; and PDD Holdings, which owns Temu, also saw its stock fall—California-based online resale marketplace The RealReal has mostly weathered the storm, and ThredUp has seen its shares climb slightly since April 2, a rare upturn amid years of decline or stagnation for the companies.

ThredUp CEO James Reinhart called the closure of the de minimis exemption for China a “leveling of the playing field [that] is long overdue.”“For years, the de minimis loophole has provided an unfair advantage to fast fashion retailers, enabling them to flood the market with low-cost, short-lived items while circumventing import duties,” the company, which has lobbied for the exemption’s end for years, said in a statement. “ThredUp sees this policy as a significant win for both the environment and the future of sustainable fashion.”