US President Donald Trump’s administration has made a stunning retreat on trade tariffs against China, exempting hundreds of billions of dollars’ worth of goods from 125% tariffs.
In a customs messaging note slipped out early Saturday, the US listed code “8517.13.00.00” – which represents smartphones – as exempt from tariffs. This means the single biggest Chinese export to America by value last year was spared import taxes alongside other electronic devices and components.
The move marks a significant about-turn for Trump’s trade strategy, which aimed to bring back iPhone production to the US. However, with 80% of Apple’s iPhones made in China, the effect would have been felt at American Apple stores soon.
Experts say this exemption could be seen as a key factor in brokering peace in the US-China trade war. Tim Cook, Apple’s CEO, has deep connections with both Trump and Chinese President Xi Jinping, making him a potential mediator in future talks.
The White House is now sidelining trade hawk Pete Navarro, who had advocated for reciprocal tariff rates, in favor of Treasury Secretary Scott Bessent. The US administration is seeking to avoid reapplying these rates after a 90-day pause, but questions remain about the incentive for other nations to offer concessions.
In an effort to calm bond market concerns, the Trump administration has also made a U-turn on tariffs affecting countries with massive trade surpluses. Around 25% of China’s exports are now exempt from the 125% tariff, with exemptions also granted to Taiwan, Malaysia, and Vietnam.
The new tariff equation offers discounts through exemptions for nations with big trade surpluses, reversing previous calculations that targeted those with deficits. The move has been described as “the Art of the Repeal,” marking a shift from complex chess strategies to straightforward negotiations.
Source: https://www.bbc.com/news/articles/cde2z6jpzp8o