Trump’s 60% Chinese Import Tariff May Pose a Threat to Global Tech Supply Chains

Key Takeaways

• Donald Trump has promised to impose 60% tariffs on Chinese imports.
• This move may have a notable impact on the global tech sector.
• Some countries have already started evaluating countermeasures.

With Donald Trump’s recent re-election, global markets are bracing for a new wave of economic disruptions, as he threatens to impose a hefty 60% tariff on Chinese imports.

The ripple effects of Trump’s aggressive trade policies are not limited to China: Other countries are already considering taking some countermeasures.

Potential 60% Chinese Import Tariff

These proposed tariffs are considerably higher than the 7.5% to 25% range implemented during his first term, and they come at a time when China’s economy is far more vulnerable.

Experts at Ars Technica noted that the tech industry—already strained by existing tariffs affecting their supply chains—is now facing an inevitable question of “when,” not “if,” it will need to raise prices on popular tech products.

While there are currently over $300 billion in tariffs on Chinese imports, consumer tech items like smartphones, laptops, tablets, and gaming consoles remain exempt.

During Trump’s previous term, the tech industry successfully lobbied to keep these items tariff-free, arguing that imposing tariffs on consumer electronics would severely impact the U.S. economy.

If new tariffs are applied, prices on gaming consoles alone could surge by up to 25% as companies struggle with rising costs, especially since a complete shift away from Chinese manufacturing is still seen as impractical.

South Korea Prepares Countermeasures

South Korea is drafting a special law to protect its semiconductor industry from global competition and potential U.S. tariffs, offering relief to companies like Samsung by easing strict work-hour rules.

The legislation comes as South Korea anticipates challenges from a Trump administration hinting at tariffs on Chinese imports. This could pressure Chinese firms to lower prices, threatening South Korean chipmakers.

The bill aims to relax work-hour limits for R&D staff and provide subsidies to major players like Samsung, which is facing stiff competition from China and Taiwan.

In the meantime, markets are closely monitoring the situation. In fact, the semiconductor sector is crucial, making up 16% of South Korea’s exports. Strengthening Samsung’s edge against Chinese rivals could impact tech sector investor sentiment.

This move is part of a broader tech rivalry involving South Korea, China, and the U.S. It could set a trend for other countries to adopt similar protective measures, reshaping the global semiconductor environment.

How Will the EU React?

Tariffs on China wouldn’t impact only the Asian giant but also the global market. European countries have already discussed how to counter Trump’s moves in order to limit the effects on their tech sectors.

“They [EU countries] don’t take our cars. They don’t take our farm products and sell millions and millions of cars in the United States,” Trump said at a rally in Pennsylvania. “No, no, no. They are going to have to pay a big price.”

European leaders are urging the EU to prepare retaliatory measures against potential U.S. tariffs, particularly in light of Donald Trump’s return.

Germany’s Ifo Center for International Economics suggested the EU should strengthen its position with deeper market integration and possible countermeasures, such as tariffs and trade restrictions, using tools like the new “Anti-Coercion Instrument.”

According to experts, possible strategies include some concessions to the U.S. The EU could avoid tariffs by offering to boost imports of U.S. goods like LNG and soybeans, similar to a 2018 deal under Trump.

Furthermore, analysts have suggested that the EU expand imports of some goods, finalize deals on sustainable steel, and increase collaboration through the EU-U.S. Trade and Technology Council.

The EU could commit to buying more U.S. defense equipment to support Ukraine, offsetting potential economic losses from tariffs.