Citic Securities: The new tariff policy brings significant benefits to cross-border platforms and sellers.

CITIC Securities pointed out that on May 2, the United States officially cancelled the exemption of tariffs on cross-border small packages, and on May 12, China and the United States issued a joint statement, stating that within 90 days, the United States will reduce the tariff rate from 125% imposed on China since April 2 to 10%. The rapid changes in tariff policies are driving the evolution of the industry ecosystem. CITIC Securities believes that the cessation of tax-free policies for small packages may accelerate the industry ecosystem towards semi-managed/3P model concentration. The suspension of "equivalent tariffs" will significantly reduce the short-term operating pressure for cross-border sellers who previously depended on the general import mode. However, in the medium to long term, the risk of tariff policies still exists under the background of China-US competition. Cross-border sellers mainly use three strategies to cope with this: price transmission, capacity transfer, and diversified layout. Considering the cancellation of equivalent tariffs this time exceeds expectations, it brings significant benefits to cross-border platforms and sellers.