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Trump Administration Exempts Electronics from Tariffs Amid Trade Tensions
In a recent policy shift, the administration of US President Donald Trump has announced the exemption of smartphones and computers from reciprocal tariffs that were initially set to be levied on imports from China. This includes the significant 125% tariffs previously imposed on Chinese goods.
A notice published by US Customs and Border Patrol revealed late on Friday that various electronic devices would not be subjected to Trump’s planned 10% global tariff, which was intended to be applied across numerous countries. This announcement comes as a response to mounting concerns expressed by technology companies within the US, who warned that such tariffs could lead to soaring prices for consumers, particularly given that a substantial portion of these products originate from China.
The exemptions also extend to a range of electronic components, including semiconductors, solar cells, and memory cards, which are crucial for the production of various consumer electronics.
According to estimates, the imposition of tariffs could have tripled the prices of popular items like the iPhone and other electronic goods within the US market, potentially pricing them out of reach for many consumers. The US represents a vital market for Apple, which accounted for over half of all smartphone sales in the country last year, as noted by Counterpoint Research.
It is estimated that around 80% of Apple’s iPhones targeted for sale in the US are manufactured in China, with the remaining assembly occurring in India, which Apple is increasingly looking towards as an alternative production hub. Alongside Apple, other major players in the smartphone market, such as Samsung, have been actively exploring strategies to diversify their supply chains and reduce dependency on Chinese manufacturing.
In recent months, countries like India and Vietnam have emerged as potential candidates for new manufacturing sites as companies aim to better position themselves amidst ongoing trade frictions. Reports indicate that Apple has expedited plans to boost production capabilities in India in light of the tariff uncertainties.
Initially, Trump had outlined a series of steep tariffs on a variety of countries set to take effect recently. However, in a swift reversal, he announced a temporary 90-day suspension of these tariffs for nations that had not retaliated against US trade policies—excluding China, where tariffs were raised substantially to 145% in response to anticipated countermeasures from Beijing.
This strategic adjustment was described by Trump as a negotiation tactic aimed at securing more favorable trade agreements with various countries. The White House emphasized that these import tariffs are intended to rectify perceived imbalances in the global trade system and to encourage job growth and manufacturing returns to the United States.
Source
www.bbc.com