Trump Tariffs Drastically Hinder Tech Industry As Trade War with China Goes into Overtime

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One of the most controversial political instruments to have been invoked by President Donald Trump was the imposition of tariffs on the import of solar panels and washing machines, as well as steel from China.

As an effect, the cost of production of many products across many industries have risen. This, in turn, caused the price of consumer goods to increase. After all, how else are these companies going to cover their operational costs, as well as the cost of procuring the materials necessary for the production of their goods?

In January 2018, the Trump tariffs were put into action in response to many of China’s alleged bad trading practices. The tariffs weighed heavily on China and cost China an estimated $250 billion so far.

China responded in kind and cost the US about $110 billion in goods. And thus began the trade war.

How do the tariffs hinder the tech industry?

The tech industry, much like the auto industry, relies heavily on steel and aluminum, both of which are materials that are significantly affected by the tariffs.

Everything from phone frames (as is the case with most flagship phones) to the microchips that are installed in these phones require steel and aluminum.

However, that’s without including the computer component industry which also makes use of these materials.

So, why impose tariffs at all?

Surely the purpose of invoking these tariffs is not merely to spite China, especially when it has a negative and significant impact on the economy of the country.

The wisdom behind these tariffs, at least according to Trump, is that companies will be forced to adjust their acquisition habits.

Instead of having to rely on the supply of other countries, US-based companies will be forced to utilize other methods in order to maintain their production.

One could say that researchers are going to be pressured into figuring out better, more affordable alternatives to these materials. This is going to make processes like x-ray diffraction more in-demand. After all, it’s about time we freed ourselves from our dependency on other countries as well as our dependency on these materials.

Another advantage that could arise from the Trump tariffs is that companies will also be forced to create more jobs in order to support the new processing facilities that they need in order to create the materials that their products need.

This means that the country, economics-wise, is going to be much more self-sustaining.

Updates on the tariffs

As of now, there have been negotiations underway with China as to how they would proceed. Both the United States and China had planned to increase their tariffs on each other further on March 1, but that too has apparently been put on hold to make way for further talks.

How things are going to turn out remains to be seen. But, if there’s one thing that’s definitely certain, it’s that the President is completely set on pushing through these tariffs.

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