US President Trump Announces High Tariffs on Semiconductors
On August 16, while traveling to Alaska in preparation for a meeting with Russian President Putin, US President Trump stated in an interview that he would impose tariffs of 200-300% on semiconductors, emphasizing that action could be taken within two weeks.
Steel and Chip Tariffs Expected Within Two Weeks
Trump indicated that new tariff measures regarding steel, chips, and semiconductors would be announced in the coming two weeks. Following his increase of tariffs on steel and aluminum to 50% in June, there is speculation on whether Trump may have misspoken this time.
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At the same time, Trump has repeatedly emphasized that tariffs on semiconductors and pharmaceuticals are forthcoming. However, these two industries have already been under investigation by the US Department of Commerce since April for national security reasons, which is a necessary prerequisite for Trump to invoke national security clauses to impose tariffs. Based on past experiences, such investigations are often time-consuming and complex, potentially taking several months or more to conclude.
(US Secretary of Commerce Lutnick: Pharmaceuticals and chips will be classified as non-negotiable assets, subject to additional national security tariffs)
Semiconductor and Chip Tariffs May Reach 300%, Industry Anxious
Given the widespread applications of chips, manufacturers and semiconductor industry players are eager to know the specific rates and rules. During a joint appearance with Apple CEO Tim Cook on August 7, Trump mentioned imposing a 100% tariff on semiconductors, but companies that establish factories in the US or commit to investments would be eligible for tax exemptions. Apple, having announced a $600 billion investment in US manufacturing, is viewed as a potential beneficiary, though the White House has yet to provide details.
Subsequently, on August 16, Trump stated that chip tariffs could be as high as 200-300%, increasing market tension, as such adjustments would have a more significant impact on the global supply chain compared to the previous rates of 50% or 100%.
(Trump: Importing chips will incur a 100% tariff; tax exemptions available for US factories or investments)
Threats to India and Russia Before the Summit, Economic Sanctions Likely to Continue
In addition to chips, Trump has also targeted tariffs at other countries. He pointed out that President Putin would bring many business leaders to the Alaska summit. While Trump believes this indicates that Putin “wants to do business,” he also emphasized that as long as the Russia-Ukraine war remains unresolved, Russia will have no business to conduct. Recently, Trump has also pledged to impose higher tariffs on “countries purchasing Russian energy” and threatened to impose a 50% tariff on Indian goods, even suggesting that if talks with Putin do not go well, he might further escalate economic sanctions against Russia.
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