Trump tells Apple to move plants from China to US

Sep 11, 2018, 01:11
Trump tells Apple to move plants from China to US

"We've taxed them $50 billion - that's on technology", the president told reporters aboard Air Force One. Then last month, the escalating trade war moved up a gear when the U.S. brought in a 25% tax on a second wave of goods worth $16bn. Exports from the world's second biggest economy increased by 9.8 per cent while its imports rose by 20 per cent compared to the same month previous year, according to customs data. He added that he's ready to place yet another round of tariffs on $267 billion in Chinese goods after that - bringing the total imports from China subject to tariffs to more than $500 billion. Apple said the tariffs would raise the cost of its USA operations and put it at a disadvantage to foreign rivals.

Apple, in pushing back on the tariff proposal, said it bought more than $50 billion worth of components from US-based suppliers a year ago and that it's the largest United States corporate tax payer.

Apple also said that, "given the balance of Apple's economic footprint, the burden of the proposed tariffs will fall much more heavily on the United States than on China". In the past Trump has allegedly assured CEO Tim Cook that the iPhone wouldn't be affected, but the leader has reversed course on other promises in the past.

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 $335 billion surplus with the US.

Trump also said the United States and Japan have begun trade talks and that Tokyo "knows it's a big problem" if an agreement can not be reached. China has not yet responded to this latest announced round of tariffs.

FILE PHOTO: Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., September 7, 2018.

At the same time, Apple is already using components sourced from USA manufacturers in some of its products.

"The move would sharply escalate a trade war with Beijing, launched over demands from the White House for major changes in economic, trade and technology policy by China". The Chinese government has said it would help local and even foreign businesses in the country mitigate the effects of the trade dispute. It brought in about $6.1 billion in revenue a year ago, according to an estimate from analyst firm Bernstein.

Imports of goods and services increased 0.9 percent to a record $261.2 billion in July. An intensified trade war would likely hurt the US more than China, according to S&P Global Ratings. Apple's letter to the United States trade office named several company products that risk facing duties; they include the HomePod, the Apple Pencil, company chargers and adapters for Apple devices, and even the leather covers for iPhones and iPads.

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