Trump threatens additional tariffs on $200 billion of Chinese goods

Trump escalates China trade war with extra tariffs

Trump escalates China trade war with extra tariffs

President Donald Trump told Apple Chief Executive Tim Cook that the United States government would not levy tariffs on iPhones assembled in China, the New York Times reported on Monday, citing a source familiar with the negotiations.

The 25 percent tariff will be applied to $50 billion of goods from China that "contain industrially significant technologies", he said.

Washington and Beijing appeared increasingly headed toward open trade conflict after negotiations failed to resolve United States complaints over Chinese industrial policies, lack of market access in China and a $375 billion United States trade deficit.

However, this time, Trump is raising the stakes over the additional $100 billion he previously said he would consider, charging the U.S. Trade Representative to consider $200 billion in additional tariffs on Chinese goods, with yet another $200 billion possible if China refuses to relent. He said he would pursue additional tariffs on another $200 billion worth of goods, for a grand total of $450 billion.

The intellectual property sanctions were the latest in a spate of protectionist measures unveiled by Trump in recent months that included tariffs on steel and aluminum imports to the U.S. and a tough rhetoric on trade negotiations from North America to Asia. Three people close to Apple, who remained anonymous because they are not authorized to speak for the company, say that the tech giant's top worry is that the Chinese wreak havoc with Apple's supply chain by forcing suppliers to provide pointless paperwork in order to gum up the works. When Trump threatened another $100 billion in tariffs if China retaliated with matching tariffs, Chinese President Xi Jinping appeared to relent with consideration of reduced tariffs on imports of US automobiles.

In a statement published shortly after Monday's announcement, China's Ministry of Commerce called the move "blackmail".

In announcing the possibility of new $200 billion in tariffs, Trump mentioned that he still has an "excellent relationship" with Chinese president Xi Jinping.


Chinese stocks fell nearly 4 per cent and alarm bells rang across global markets on Tuesday, as the trade dispute between the United States and China escalated further.

But, he said, "the United States will no longer be taken advantage of on trade by China and other countries in the world".

The intensifying trade row threatens to put more pressure on the already cooling Chinese economy, risking an end to a rare spell of synchronized global expansion and collateral damage for its export-reliant Asian neighbors.

It said, "If the US side becomes irrational and issues the list, China must adopt comprehensive measures of the same quantity and quality in order to take strong countermeasures".

"Everyone knows. China is the main perpetrator, " he said.

These latest measures come as an escalation and could make it hard for China to retaliate further, given the country only imported about $170bn of U.S. goods and services previous year. When you consider the number of jobs that Apple is responsible for in the country, and how highly the iPhone is thought of in China, we'd expect the device to be kept out of the trade war by China, too.

The tariffs announced by the White House on Friday hit more than 1,100 Chinese products with a rate of 25 percent.

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