Apple: China Tariffs by Trump Will Hurt Company

Apple: China Tariffs by Trump Will Hurt Company

President Trump's trade war with China moved up a gear last month when the U.S. brought in a 25% tax on a second wave of goods worth $16bn.

Trump's announcement came the day after the public comment period closed on tariffs on $200 billion of Chinese imports. The company is concerned, however, about the Trump administration's proposal to add 25 percent duties on another $200 billion in Chinese goods, including a wider assortment of consumer-related items. And on September 7, he said he's ready to hit another $267 billion worth of Chinese imports with tariffs, with his underlings preparing the necessary paperwork. "That changes the equation".

In an interview with Bloomberg, White House economic adviser Larry Kudlow suggested that President Trump would be willing to meet with China's Xi Jinping, and possibly discuss de-escalating the trade war.

Stock prices slipped after his comments, with the S&P 500 off 0.2 percent, while China's off-shore trade yuan currency fell against the dollar.

Despite several rounds of talks between USA and Chinese officials, the two countries have made little progress toward resolving their differences.

"I don't think this magnitude of tariffs has been priced into the markets", Lara Rhame, chief USA economist at FS Investments, told Bloomberg Television in an interview.

US President Donald Trump waves during joint statements with China's President Xi Jinping at the Great Hall of the People in Beijing, China, November 9, 2017.

"Even though footwear is not on the third list proposed by the Trump administration, many other consumer goods and production machinery is at risk, driving up prices for all American consumers", said Matt Priest, president and CEO of the Footwear Distributors and Retailers of America.

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.




But, they'd also be hit by the threatened 267 billion dollar list.

Apple does not disclose specific revenues for most of the affected products, but the Apple Watch may be the biggest seller. It said in a late submission that its AirPods headphones, some of Apple's Beats headphones, and its new HomePod smart speaker would face levies, causing its shares to slip in late trading.

It is not immediately clear how Apple could pay no tax if it moved its manufacturing process to the US. China has warned that it would retaliate with import taxes on $60 billion worth of US goods.

"The Chinese aren't paying these tariffs, American families are going to pay these tariffs". Among the equipment hit were a number of components and devices used by USA tech firms, including chips and networking gear produced in Chinese factories.

"Our view on tariffs is that they show up as a tax on the consumer and wind up resulting in lower economic growth", Tim told investors last month.

The impact for US consumers could range from $2.3 billion up to $5.7 billion depending on how high the tariff goes.

Freeland told reporters she and US Trade Representative Robert Lighthizer will be "reviewing the work the officials have done" and said "the atmosphere continues to be constructive".

"It's never too late to make good trade policy", Kudlow said.

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