Political Affairs Across Nation |

Political Affairs Across Nation |

U.S. President Threatens 50% Tariff on EU Imports, Proposing Tax on Smartphones Made Abroad

WASHINGTON (AP) - In a series of posts on his social media platform, President Donald Trump has threatened to impose a 50% tariff on all imports from the European Union, as well as a 25% tariff on smartphones unless they are manufactured domestically.

The move, reflecting the president's capacity to disrupt the global economy with a digital whirlwind, comes as his tariffs have thus far failed to produce the trade deals he seeks or the return of domestic manufacturing that he promised voters.

Trump expressed dissatisfaction with the lack of progress in trade talks with the EU, which has proposed mutual tariff reductions to zero, even as the president has publicly upheld a baseline 10% tax on most imports.

"Our discussions with them are going nowhere!" Trump posted on Truth Social. "Therefore, I am recommending a straight 50% Tariff on the European Union, starting on June 1, 2025. There is no Tariff if the product is built or manufactured in the United States."

Speaking later in the Oval Office, Trump emphasized his resolve, stating, "I'm not looking for a deal. We've set the deal. It's at 50%."

The president's announcement extends tariff threats to Apple, joining major U.S. companies like Amazon, Walmart, and others in the White House's crosshairs. Trump wrote, "I have long ago informed Tim Cook of Apple that I expect their iPhones that will be sold in the United States of America will be manufactured and built in the United States, not India, or anyplace else. If that is not the case, a Tariff of at least 25% must be paid by Apple to the U.S."

Trump later clarified his post to include all smartphones made abroad, stating, "It would be also Samsung and anyone that makes that product. Otherwise, it wouldn't be fair."

The statements highlight Trump's potential shift in approach, as he appears to place the burden of tariffs on companies themselves, contradicting earlier claims that foreign countries would shoulder the cost of import taxes. In general, importers bear the tariffs, which are often passed along to consumers in the form of higher prices.

In response to Trump's tariffs on China, Apple CEO Tim Cook said earlier this month that most iPhones sold in the U.S. during the current fiscal quarter would come from India, with iPads and other devices being imported from Vietnam. Analysts estimate that an iPhone made in America could jump in price from $1,200 to anywhere between $1,500 and $3,500 if subjected to 25% tariffs.

The potential tariffs have the capacity to trigger market instability, as businesses and investors adjust to the prospect of disrupted trade flows and lower growth prospects. Stocks sold off after Trump's postings, with the S&P 500 index down roughly 0.5% in Friday afternoon trading.

U.S. Treasury Secretary Janet Yellen offered some clarification on Trump's tariff proposals during a Friday interview on Fox News. She highlighted the EU's "collective action problem," due to its 27 member states being represented by a single group in Brussels. Yellen also revealed that she had spoken with Apple CEO Tim Cook during the week.

The EU's executive commission considers trade with the U.S. roughly balanced when goods and services are included. The U.S., as a global center for finance and technology, runs a trade surplus in services with Europe, counteracting some of the trade deficit in goods and bringing the imbalance down to 48 billion euros ($54 billion).

European foreign minister Johann Wadephul said the EU's executive commission has Germany's full support in efforts to "preserve our access to the American market." Wadephul expressed uncertainty about the impact of such tariffs, stating, "I think such tariffs help no one, but would just lead to economic development in both markets suffering." He added that the EU is continuing negotiations and working on persuading the U.S. administration.

Marcel Fratscher, the head of the German Institute for Economic Research, criticized the EU's strategy as a failure, arguing that Trump recognizes the EU's hesitation and concessions as weaknesses. Economist Mary Lovely suggested that Trump's approach suggests the U.S. is an unreliable trading partner, operating on whim rather than rule of law.

Trump's inconsistent approach toward Apple mirrors his unpredictable behavior with other U.S. companies. He has publicly admonished companies like Walmart for not eating the costs of his tariffs, even though doing so could squeeze profits and lead to layoffs. By imposing similar pressure on Apple, Trump may be seeking to force the tech giant to shift its supply chains at higher costs.

Trump aides have stated that the goal of his tariffs is to isolate China and strike new agreements with allies. However, the president's tariff threats undermine that logic, as the EU may face higher tariffs than China, and could have benefited from uniting with China and other countries to form a broad front against Trump's trade policy[1][2][3].

1. The 50% tariff proposed by President Trump on EU imports extends beyond smartphones, also likely affecting businesses in the retail industry.
2. Trump's threat of a tariff on smartphones may impact students, as the increase in phone prices could strain their personal budgets.
3. The technology industry, particularly smartphone manufacturers like Apple and Samsung, is at the forefront of the ongoing trade disputes between the U.S. and EU.
4. The proposed tariffs could have far-reaching effects on the manufacturing sector, as it may incentivize companies to shift manufacturing operations back to U.S. soil.
5. The potential tariffs on imported smartphones could impact the finance industry, as investors may hesitate to invest in companies that face increased costs due to these tariffs.
6. Trump's tariff proposal could have significant implications for policy-and-legislation, potentially leading to changes in trade and taxation policy.
7. In his pushing for domestic manufacturing, President Trump's tariffs may inadvertently contribute to the war-and-conflicts narrative, as countries heavily reliant on the global economy could face economic instability.
8. The ongoing trade disputes between the U.S. and EU stir general-news headlines, as businesses and consumers alike wait to see how these tariff threats will unfold.
9. The EU's approach to negotiating trade deals with the U.S. has been described as a collective action problem, with 27 member states representing a single group in Brussels.
10. Tim Cook, CEO of Apple, has been actively addressing the potential impact of Trump's tariffs on the company's supply chain, seeking ways to minimize costs and maintain competitiveness in the market.

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