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Apple Issues Letter Responding to President Trump’s Proposed Tarrifs

Apple Issues Letter Responding to President Trump’s Proposed Tarrifs

And wouldn't you know it, after seeing an outline of products that would be hit by the U.S. government's 25 per cent tax on $US200 billion-worth ($280 billion-worth) of imported Chinese tech, Apple penned a letter to the United States Trade Representative essentially saying, "Hey, would you not?"

Beijing has warned that it would hit back with duties on $60 billion in American products - a much smaller figure that shows China will not be able to match USA tariffs dollar-for-dollar. By 2021, based on International Monetary Fund economic forecasts, the USA would lose about 1 percent of its annual output or about $230 billion while China would lose 0.6 percent of its $18 trillion economy that year or $110 billion.

Apple declined to comment beyond its filed statement.

Apple did not respond to requests for comment.

Washington is demanding Beijing to improve market access and intellectual property protections for USA companies, cut industrial subsidies, and slash a $375 billion trade gap. The company manufactures the vast majority of its products in China and exports them to the US, making them potential tariff targets.

CURRENCIES: The dollar fell to 111.27 yen from 111.51 yen.

Apple also said that computer parts for its U.S. operations would be hit by the tariffs. Stocks slipped on Trump's latest threat, and they drifted lower on the week, with investors bracing for the next salvo in Trump's protectionist crusade.

Apple generated $9.6 billion in sales in China in the fiscal third quarter, accounting for 18 percent of its total revenue in the period.

China's Xi offers $60 bn Africa aid, says 'no strings attached'
He also announced an additional $60 billion of loans and other financing to follow on a similar amount promised three years ago. In addition, he said China will encourage companies to invest at least $10 billion in Africa over the next three years.

Since we introduced Apple Watch a few years ago, we have heard from users about how it has changed, and in some cases saved their lives. However, that could change if the Trump administration follows through with earlier threats of levies on $500 billion in imports, which would cover just about everything China exports to the us, trade experts say.

On Apple's most recent earnings call in July, Chief Executive Officer Tim Cook said the company could face such tariffs "related to data centers".

Trump tweeted that: "Apple prices may increase because of the massive Tariffs we may be imposing on China - but there is an easy solution where there would be ZERO tax, and indeed a tax incentive".

"The direct economic effects of the U.S. -Chain tariff dispute have so far been limited".

Meanwhile, talks with Canada continued for another day Thursday to keep NAFTA 2.0 as a three-party trade deal - although Trump on Wednesday said he would "surprise" the public with a new name. China, for its part, may be willing to endure short-term pain and see how the US midterms turn out.

A part of Apple's letter, which was first reported on by Bloomberg, reads, "It is hard to see how tariffs that hurt US companies and USA consumers will advance the Government's objectives with respect to China's technology policies". The Office of the U.S. Trade Representative (USTR) as of press time has not released a list of what goods could be affected.

Other tech companies have expressed concern, too.

White House Economic advisor Larry Kudlow told CNBC that talks between the US and China were ongoing.

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