Trump threatens new tariffs on $267bn of Chinese goods
Donald Trump has said he has a new tranche of tariffs ready to place on virtually all Chinese goods, as Apple warned the trade war will make its products more expensive for American consumers.
A package of tariffs was already close to being imposed on $200bn worth of Chinese goods imported to the US, Trump said, while suggesting a further package, worth $267bn, could also be imposed, which would sharply escalate his 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 level 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 two countries will derail the global economy. China has threatened to retaliate 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 onboard 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 Trump went ahead with the first tariff package.
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 $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 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 offshore trade yuan currency fell against the dollar.
The $200bn list, which includes some consumer products such as cameras and recording devices, luggage, handbags, tyres and vacuum cleaners, would be subject to tariffs of 10-25%.
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.