Why Trump makes an exception for phones and technology from China

US President Donald Trump takes a step back in the trade war with China. By reversing import duties on electronics, telephones, chips and chip equipment, he tries to de-escalate the trade conflict with China. It also seems like an opening move to negotiate with the Chinese government, which so far not week for Trumps taxes.

The trade conflict between the two largest economies in the world was high last week, because China answered the US import duties with its own taxes and countermeasures. China now lifts 125 percent on American products, the US raises 145 percent on Chinese products.

Apple in particular, which has been relating to one for decades ‘Made in China’ strategyis vulnerable to this extreme cost increase. In recent days, the White House was attacked by lobbyists from the tech sector. They made it clear to Trump that American companies and citizens will immediately feel the taxes in their wallets and that would chase inflation. Trump blamed his predecessor Joe Biden that he had the price of eggs rise too high. He does not want to be remembered as the president who made the iPhone priceless.

Freedom

Apple seems to be released with the shock; On Friday, American customs published a list of exceptions for, among other things, smartphones, computers and electronics. These are the most important product categories that import the US from China. In 2024 it was 88 billion dollars in telephones and computers, in value about one fifth of the total American import. There is still – insofar as something is clear in the current tax chaos – a ‘basic tax’ of 10 percent.

Trump and his trade adviser Peter Navarro wants to restore the crooked trade balance with China, with the US importing much more goods from China than the other way around. High import tariffs would force American companies to produce goods in the US again, no longer in China or elsewhere in Asia. But America does not have the experienced people to set up an advanced manufacturing industry, let alone the same costs.

By making an exception for telephones and computers, Trump seems to undermine his own re-industrialization theory. That contradiction is partly tactics; Take hard first, and then quickly correct if the reactions are fierce. The tumult is part of it, because fierce market reactions on stock exchanges and fierce media promotions about those market reactions put pressure on trading partners to conclude ‘deals’. Credibility is not Trumps greatest care, as long as he represents the most powerful economy in the world.

Escalation with China unforeseen

But the escalation with China was not foreseen – the White House seems to have underestimated that that country did not want to admit a thumb -wide. The Chinese economy has more irons in the fire than other countries that put Trump under pressure. For example, China is the most important producer of rare metals and it is an important buyer of American chips and chip equipment. Companies such as Tesla and Apple each get around 20 percent of their turnover from China. According to Tesla boss Elon Musk, the war war does more harm than good; It is a point of discussion that puts pressure on his apparently close collaboration with Trump.

In addition to Tesla, stock market favorites Apple and Nvidia also lost 20 percent of their market value since Trumps took office in January. For the time being, the tech companies seem to be freed from the disastrous consequences of ‘Liberation Day’ – the day on which Trump announced his list of taxes. After more than a week there is little left of that ‘historical’ list of percentages, a list on which Countries were also without residents.

The expectation is that stock markets will respond positively. The news about the exceptions came out after closing the stock market. That was different last week: Trump loaded the suspicion of stock market manipulation, when he announced a « break » on import duties on Wednesday. In the morning he hinted that it was a good time to buy, in the afternoon he made the change and then congratulated in the White House two fellow millionaires With their race gains achieved.

There was also a line on Friday due to the American taxes on chip equipment. That seems good news for ASML, because the Dutch chip machine maker does not have to increase prices if it delivers to American factories. In 2024, the US imported $ 8.7 billion in chip machines, half of which was borne by ASML. The US wants to expand the chip industry on its own soil, to be less dependent on Taiwan. Levensings would delay that process.

President Trump announced on Monday to elaborate on the exceptions to the taxes. China, in turn, called on the US to completely abolish the import duties. « We are urging the US to take a big step to correct their mistakes, » said a spokesperson for the Ministry of Commerce in a statement. Anyway, in the past week and a half teaches that the American taxes can change any time.

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