China threatened to prevent American trade if U.S. president-elect Donald Trump imposes his campaign promise to place massive tariffs on the country’s imports.
China-based Foxconn, which has nearly 1.5 million workers, is the primary site where Apple’s iPhone is produced. China could step in and stop or disrupt production if Trump’s threatened tariffs are made official.
One of the most notable pledges that Trump made during his campaign was to order what he referred to as “defensive” tariffs of 45% on Chinese imports and to force Beijing to officially declare itself a currency manipulator. At a rally in Florida in August, Trump suggested these tariffs would force China to “stop the cheating.”
An op-ed published in China’s state-run newspaper, Global Times , warned that the People’s Republic would adopt “a tit-for-tat approach,” which would result in the country no longer buying American goods, including the ever-so-popular Apple products. It read:
A batch of Boeing orders will be replaced by Airbus. U.S. auto and iPhone sales in China will suffer a setback, and U.S. soybean and maize imports will be halted. China can also limit the number of Chinese students studying in the U.S.
Trump as a shrewd businessman will not be so naïve. None of the previous presidents were bold enough to launch an all-out trade war against China. They all opted for a cautious line since it's most consistent with the overall interests of the U.S., and it's most acceptable to U.S. society.
A report conducted at the end of 2015 found that an estimated 131 million iPhones are in use in China, more than any other manufacturer. Data released by the Chinese government noted that Apple had 16.8% of the market, a point higher than Samsung, and 1.2% more than China-based Xiaomi.
Shortly after Barack Obama was elected president the first time, the U.S. issued a 35% import tariff on Chinese tires. This urged retaliatory tariffs on chicken and car exports.
“Both China and the U.S. suffered losses as a result,” the Global Times said. “From then on, the Obama administration waged no trade war against China. If Trump imposes a 45% tariff on Chinese imports, China-U.S. trade will be paralyzed.”
Source: Ars Technica
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