US China trade war escalates as Trump raises tariffs on $200 billion of Chinese products

Further duties of $325 billion worth of Chinese goods also threatened, which has the potential to affect tech companies like Apple

US China trade war escalates as Trump raises tariffs on $200 billion of Chinese products

The US has more than doubled tariffs on $200 billion worth of Chinese goods on Friday after talks on trade dragged over the Thursday night deadline.

Duties have been raised from 10 per cent to 25 per cent. The move affects goods such as telecommunications equipment, computer circuit boards, processing units, computer parts and various other products.

The Donald Trump administration has also threatened further tariffs on $325 billion worth of Chinese goods.

Trade tensions

The US president is unhappy about the large trade deficit it has with China, which the BBC pegs at $419 billion in 2018.

The US wants to reduce that deficit while also pressuring China into changing some of its economic policies that it claims unfairly benefit Chinese companies, such as subsidies for local firms and the country’s IP rules.

China it seems is refusing to be bullied in negotiations and has threatened to introduce new measures of its own in the ongoing trade war between the two countries.

Despite the new tariffs and rhetoric, talks on a trade deal are said to be continuing.

Impact on tech

Tariffs on new goods have the potential to affect large US companies such as Qualcomm and Apple.

With the companies conducting a lot of business in China, as well as manufacturing tech and hardware such as the iPhone in the country, a hike in tariffs and retaliatory actions by China could be costly for the firms.

Ultimately, further tariffs have the potential to raise prices on products such as the iPhone for US consumers if those costs are passed on.

Apple CEO Tim Cook has already previously said the trade war between the countries has had an impact on its finances. He previously claimed that the dispute has exacerbated an economic downturn in China, thus affecting sales in the market.

At the time, Apple revised its financial guidance for the quarter ending December 29th, the first time it had done so in over 15 years.

“As the climate of mounting uncertainty weighed on financial markets, the effects appeared to reach consumers as well, with traffic to our retail stores and our channel partners in China declining as the quarter progressed,” said Cook.

“And market data has shown that the contraction in Greater China’s smartphone market has been particularly sharp.”

He added: “Lower than anticipated iPhone revenue, primarily in Greater China, accounts for all of our revenue shortfall to our guidance and for much more than our entire year-over-year revenue decline.”

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Craig Chapple is a freelance analyst, consultant and writer with specialist knowledge of the games industry. He has previously served as Senior Editor at, as well as holding roles at Sensor Tower, Nintendo and Develop.