WSJ's Take On the Week Who Really Pays for Tariffs? Citi’s Trade Lead on the Economic Impact
Sep 14, 2025
Adoniro Cestari Neto, head of trade and working capital solutions at Citigroup, discusses the economic impact of U.S. tariffs. He reveals how global companies adapt their supply chains to mitigate costs without burdening consumers. Cestari Neto elaborates on the complexities of pricing strategies and the shared financial impact of tariffs across all stakeholders. The conversation also highlights innovative approaches like the 'China plus one' strategy and the growing trend towards reshoring as companies strive for production efficiency in a changing economic landscape.
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Initial Corporate Pause And Inventory Build
- After the tariff announcement clients stopped and accumulated inventory, then moved to a wait-and-see mode for strategic shifts.
- Markets adjusted as expectations of extreme tariffs faded and supply-chain deals reduced immediate shock.
Efficiency Over Price Passing
- Firms reroute shipments and renegotiate supplier deals to mitigate tariff exposure.
- Many supply-chain fixes leverage post-COVID diversification trends rather than radical reshoring.
Benchmark And Leverage Finance For Efficiency
- Benchmark supply chains and use financial instruments to improve efficiency and reduce tariff cost.
- Engage suppliers, logistics partners and banks to redesign flows and financing to protect end-consumer pricing.