President Donald Trump has advised Apple to open up manufacturing plants in the US to circumvent potential retaliatory tariffs from China.
The statement, which was made in a tweet, claims that opening up US plants would be the "easy solution where there would be ZERO tax".
Apple prices may increase because of the massive Tariffs we may be imposing on China - but there is an easy solution where there would be ZERO tax, and indeed a tax incentive. Make your products in the United States instead of China. Start building new plants now. Exciting! #MAGA
— Donald J. Trump (@realDonaldTrump) 8 September 2018
Apple recently warned consumers that its Apple Watch, Mac mini, Homepod and other Apple accessories could increase in price once China levies its tariffs in response to the tariffs the US has planned to impose on China. The Trump administration's new proposed tariffs will affect up to $200bn worth of Chinese goods, including goods made by US firms in China. For comparison, the prior round of tariffs imposed on China by the US affected only $50bn worth of Chinese goods.
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In a letter to the US Trade Representative's office, Apple explained the flaw in the proposed tariff plans, stating: "All tariffs ultimately show up as a tax on US consumers, they will increase the cost of Apple products that our customers have come to rely on in their daily lives."
Despite President Trump's insinuation, Apple does in fact manufacture some products within the US and, in January 2018, announced plans to open up a new US campus. This, along with other plans, will supposedly add 20,000 new jobs across the US over the next five years and pump up to $350bn into the US economy.
However, Apple claimed it would be near impossible for it to produce every one of its products in the US due to labor concerns, as well as the number of component producers it works with in China – components it would now have to have to import.