By Abiola Olawale
It appears China has secured a win in the ongoing trade war as the United States government has announced exemptions for smartphones, computers, and other electronics from its reciprocal tariffs.
The decision, detailed in a late Friday notice by the US Customs and Border Protection, spared these high-tech products from the 125% tariffs imposed on Chinese goods, which, combined with other levies, had reached a staggering 145%.
The exemptions cover a wide range of electronics, including semiconductors, hard drives, and flat-panel displays, many of which are predominantly manufactured in China.
Additionally, machines used in semiconductor manufacturing were exempted. This is a significant development for companies like Taiwan Semiconductor Manufacturing Co. (TSMC), which has announced large-scale investment plans in the US, as well as for the broader chipmaking sector.
Analysts have suggested that this latest move reflects concerns over potential price hikes for American consumers and disruptions to global supply chains, particularly for tech giants like Apple, which relies heavily on Chinese production.
Roughly 90% of iPhone assembly occurs in China, and the exclusions have been hailed as a relief for the tech sector.
This comes in the wake of the tariff wars which have escalated to the imposition of a 125% duty on goods entering the US from China
Recall that Global Head of Technology Research at Wedbush Securities, Dan Ives, had warned that tariffs could have a far-reaching impact on tech consumers and multinational companies like Apple, with iPhone prices expected to increase three times.
According to him, the idea of Apple shifting its entire supply chain to the US is economically impractical.
Ives warned that an iPhone assembled entirely in the United States could retail for as much as $3,500, compared to the current price of around $1,000.
