Trump threatens new tariffs on Chinese smartphones days after exemptions

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President Donald Trump participates in a video teleconference call with members of the military on Thanksgiving, Thursday, Nov. 26, 2020, at the White House in Washington. (AP Photo/Patrick Semansky)

United States President Donald Trump has said that smartphones and electronics made in China will not be left out of the new US tariffs, just days after officials said some products would be exempt.

Trump made this statement on social media, saying reports about exemptions for electronics were false. According to him, these products are not escaping tariffs — they are only being moved to a different “tariff bucket”.

“We are taking a look at semiconductors and the WHOLE ELECTRONICS SUPPLY CHAIN in the upcoming National Security Tariff Investigations,” Trump wrote. He promised to give more details on Monday about new tariffs related to semiconductors.

Last Saturday, a notice from US customs had said smartphones, computers, and other devices would not face the 125% tariff that was placed on Chinese goods earlier in April. This news had calmed the stock market briefly.

But Trump’s latest comments have caused fresh concerns. Investors are now waiting for clearer information on how the new “semiconductor tariff” will affect global trade.

US Commerce Secretary Howard Lutnick confirmed on Sunday that smartphones and other electronics will instead fall under a different tariff related to semiconductors. He explained, “We need our medicines and we need semiconductors and our electronics to be built in America.”

The US had earlier placed a 54% tariff on Chinese imports in early April, which later increased to 145%. In response, China also raised its own tariffs on American products, going as high as 125%.

China’s Ministry of Commerce had earlier called the temporary exemptions from the US a “small step” and asked the US government to completely cancel the tariffs and return to “mutual respect”.

Trump’s back-and-forth on trade policies has made some companies take action. For example, Sony announced a 10% price increase for its PlayStation 5 in Europe, Australia, and New Zealand. The company blamed the rising cost on inflation and unstable exchange rates.

There are currently no talks planned between Trump and China’s President Xi Jinping, according to US Trade Representative Jamieson Greer.

The White House says the tariffs are meant to bring fairer trade deals and bring more jobs back to the US. But experts warn that these sudden changes could hurt global trade, businesses, and jobs around the world.

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