Trump Threatens New Tariffs On Smart Phones

Donald Trump has said Chinese-made smartphones and other electronics will not be exempt from tariffs, adding that they are simply moving into a different levy “bucket.”

European stock markets bounced up Monday morning after Friday’s official announcement that some of these products would escape up to 145% levies.

China has called on Donald Trump to “completely cancel” his tariffs regime and “return to the right path of mutual respect”.

However, US officials said on Sunday that products would be subject to a “semiconductor tariff” instead, and Trump is expected to reveal more details later.

US Commerce Secretary Howard Lutnick said the new levy would be in addition to a host of global tariffs the US imposed earlier this month, then paused for 90 days.

“We need our medicines, semiconductors and electronics to be built in America,” he added.

On Saturday, a US customs notice revealed that smartphones, computers, and other electronic devices would be excluded from the 125% tariff on goods entering the country from China.

However, Trump tweeted on social media, saying there was no exemption for these products and calling such reports about this notice false. Instead, he said, “They are just moving to a different Tariff ‘bucket’.”

Trump added: “We are looking at Semiconductors and the Whole Electronics Supply Chain in the upcoming National Security Tariff Investigations.” He said he would provide an update on semiconductor duties on Monday.

Everyday devices such as smartphones and laptops rely on semiconductors, small and powerful pieces of tech that form the basic building blocks of modern computation.

On Monday, Sony announced that it was increasing the price of its flagship games console, the PlayStation 5, by about 10% in Europe, Australia, and New Zealand. It cited a “challenging economic environment”, inflation, and fluctuating exchange rates. It did not announce price rises in the United States.

The Chinese commerce ministry called Trump’s exemptions a “small step” by the US and said that Beijing was “evaluating the impact” of the move.

However, Trump administration officials’ suggestions for plans for future levies may dampen hopes of a thaw in the two rivals’ protectionist posture.

On Sunday, US Trade Representative Jamieson Greer was asked whether Trump planned to speak with his Chinese counterpart, Xi Jinping.

“Right now, we don’t have any plans on that,” he said during an appearance on CBS’s Face the Nation.

At the beginning of April, Trump imposed a 54% tariff on imports of products from China, which escalated to the current 145% rate.

In its tit-for-tat tariffs, China imposed levies of 34% on US goods before increasing it to 84% and 125%, which took effect on Saturday.

In announcing its latest tariffs, China’s commerce ministry said last week that it would “fight to the end” if the US “insists on provoking a tariff war or trade war”.

Late on Saturday, while travelling to Miami, Florida, Trump said he would give more details of the exemptions at the start of next week.

The White House has argued that it uses tariffs as a negotiating tactic to extract more favourable trade terms from other countries.

Trump has said his policy will redress unfairness in the global trading system and bring jobs and factories back to the US.

However, his interventions have caused massive fluctuations in the stock market and raised fears of a decrease in global trade that could affect jobs and individual economies.