Tech firms brace for tariff fallout.
Trade group says widespread tariffs will cost American jobs
The latest round of tariffs on Chinese goods imposed by the Trump administration is set to shake up many American industries, including tech, affecting businesses making everything from semiconductors to flash memory.
The United States said Tuesday it will hit $16 billion worth of Chinese imports with 25 percent tariffs later this month, ramping up its trade war with China, which retaliated with its own tariffs on $16 billion worth of U.S. goods Wednesday.
The tariffs are “part of the U.S. response to China’s unfair trade practices related to the forced transfer of American technology and intellectual property,” the Office of the United States Trade Representative said in a statement.
Tech trade groups — some of which met with the White House last week — are not happy.
“The new tariff list — covering major technology categories such as semiconductors and the equipment that makes them — includes 58 products our member companies say are critical to their businesses — and taxing them will cost American jobs,” said Gary Shapiro, president and CEO of the Consumer Technology Association, in a statement Wednesday.
Among the consumer product categories that will be most affected are semiconductors, which had $1.1 billion worth of imports in 2017, $754 million worth of flash memory, $700 million of integrated circuits and $1.46 billion in other machinery such as guitar pedals and amplifiers, the CTA said.
“These taxes are especially dangerous for small- and medium-sized companies,” Shapiro said. “We’ve heard from many small businesses and startups who tell us the tariffs are forcing them to make difficult decisions about their workforces and their companies’ futures.”
During last week’s meeting, White House officials told tech industry representatives that the tariffs will be good for tech in the long run, Axios reported. But they don’t appear to be buying it. “We are disappointed and puzzled by the fact that semiconductors and
related products remain on the final tariff list,” said John Neuffer, Semiconductor Industry Association president and CEO, in a statement Wednesday. “We have made the case to the Administration, in the strongest possible terms, that tariffs imposed on semiconductors imported from China will hurt America’s chipmakers, not China’s, and will do nothing to stop China’s problematic and discriminatory trade practices.”
Last month, the United States imposed tariffs on $34 billion worth of Chinese imports.
This second round of tariffs, which includes 279 categories of goods mostly used in manufacturing, is set to go into effect Aug. 23.
The White House also is proposing 10 percent tariffs on an additional $200 billion worth of Chinese imports, which would have a more direct effect on consumer goods, including tech gadgets such as the Apple Watch, Fitbit activity trackers and Sonos speakers.