Donald Trump threatens $267bn more tariffs on Chinese goods

  08 September 2018    Read: 882
Donald Trump threatens $267bn more tariffs on Chinese goods

Donald Trump has warned that he has a new tranche of tariffs covering virtually all Chinese goods entering the US ready to go, as Apple said that the US-China trade war will make its products more expensive for American consumers.

A package of tariffs worth $200bn is close to being imposed on Chinese imports to the US and Trump’s latest suggested round – which would be worth $267bn – would sharply escalate Trump’s trade war with China.

Economic tensions between the two countries were heightened further on Saturday when official data showed that China’s trade surplus with the US widened to a record in August. 

The surplus – which Trump often invokes to justify his tough line on trade – hit $31.05bn in August, up from $28.09bn in July. Over the first eight months of the year, China’s surplus with the US has risen nearly 15%.

Many economists and investors are concerned the standoff between the pairwill derail the global economy. China has threatened retaliation against tariffs, which could include action against US companies operating there.

Trump, who has demanded that Beijing make major changes in economic, trade and technology policy, told reporters aboard Air Force One that he was “being strong on China because I have to be”.

“The $200bn we are talking about could take place very soon depending on what happens with them. To a certain extent it’s going to be up to China,” Trump said. “And I hate to say this, but behind that is another $267bn ready to go on short notice if I want. That totally changes the equation.”

His comments came as Apple warned that products made in China including the Apple Watch and Air Pods headphones would cost more if Donald Trump goes ahead with the $200bn tariffs.

Reuters and Associated Press contributed to this report.

In a letter to US officials as part of the public consultation on the measures, the company said some of Apple’s Beats headphones and its new HomePod smart speaker would also face levies.

“Our concern with these tariffs is that the US will be hardest hit, and that will result in lower US growth and competitiveness and higher prices for US consumers,” Apple said in the letter.

The bestselling iPhone has so far been spared the levies but the new $267bn package would affect the devices, which accounted for about two-thirds of Apple’s $229bn in revenue in its most recent fiscal year.

Apple’s letter also made no mention of the iPad, which brought in $19.2bn in sales in the most recent year, or most of its Mac computers, which generated $25.8bn. Apple said its MacMini, a low-priced computer that comes without a keyboard or mouse, would be affected, as well as accessories such as mice, keyboards, chargers and even leather covers for iPhones and iPads.

US stocks slipped after Trump’s comments, with the S&P 500 off 0.2%, while China’s off-shore trade yuan currency fell against the dollar.

In June, Trump imposed 25% tariffs on $50 billion worth of Chinese goods, mostly industrial machinery and intermediate electronics parts, including semiconductors.

The $200 billion list, which includes some consumer products such as cameras and recording devices, luggage, handbags, tires and vacuum cleaners, would be subject to tariffs of 10% to 25%.

The technology sector is one of the biggest potential losers in the proposed $200bn tariff list. Fitness tracker maker Fitbit said it would be hit by tariffs, and chipmaker Intel Corp said the levies could slow down the adoption of 5G networks, the next generation of wireless data technology for phones and other devices. 

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