Finance

Trump ups ante on China

Trump ups ante on China

Apple laid out the impact on its products of the Trump administration's proposed tariffs on $200 billion worth of Chinese goods in an unsigned letter it submitted on Wednesday to US officials as part of a public comment period.

A "wide range" of Apple Inc AAPL.O products including the Apple Watch would be affected by proposed USA tariffs on Chinese goods, the company told US trade officials, but gave no sign of an impact on its iPhone cash cow.

There was no indication in the comments made by Trump on Friday as to which items would be targeted in a future round of tariffs, as most seafood products imported from China already have been slapped with higher tariffs.

Cell phones, the biggest US import from China, have so far been spared, but would be hit if Trump activates the new $267 billion tariff list.

The company is highly exposed to a trade war between the US and China. Make your products in the United States instead of China.

This week, Apple said that a proposed new round of $200 billion in additional tariffs on Chinese imports would raise prices on some of its products, including the Apple Watch and the Mac mini.

"More broadly, tariffs will lead to higher USA consumer prices, lower overall US economic growth, and other unintended economic consequences".

Trump is urging the Cupertino-based company to "start building new plants now".

For January-August, China's trade surplus with the United States was $192.64 billion, compared with about $167.94 billion in the same period a year ago.

Mr Trump has boasted that trade wars are "easy to win" and warned he would hit virtually all Chinese imports if Beijing does not back down and take steps to reduce its US$335 billion surplus with the US.

He continued: "And I hate to say that, but behind that, there's another $267 billion ready to go on short notice if I want. That changes the equation". Cook's personal diplomacy stands in stark contrast to some of his peers in the tech industry, who haven't engaged Trump directly - and often are on the receiving end of far more aggressive tweets attacking their business practices.

China's trade surplus with the United States reached a record $31 billion in August, despite hefty tariffs recently imposed on Chinese goods.

Apple, like other tech giants, has benefited from the last year's overhaul to the USA tax code, and the company has committed to returning much of the $252 billion in cash it held overseas.


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