On Friday, President Donald Trump escalated the US trade battle by threatening to impose a 50 percent duty on the European Union and a new 25 percent levy against Apple.
Trump said on Truth Social that he is suggesting “a straight 50% Tariff on the European Union, starting on June 1, 2025,” while lamenting that talks with the EU “are going nowhere.”
The present US baseline tariff of 10 percent would be drastically increased if the new duties are implemented, and tensions between the largest economy in the world and its largest trade bloc will increase.
Despite his repeated requests, the president claimed in a second tweet that Apple had not moved iPhone production to the United States and threatened to impose new duties of “at least” 25 percent if they did not comply.
Following the news, Wall Street stock futures plummeted, with Apple’s share price down more than 3% in pre-market trade.
Wall Street’s “fear gauge,” the VIX volatility index, went up over 20 percent.
Trump implemented broad tariffs against the majority of nations last month, imposing high taxes on a number of trading partners, including the EU, as well as sector-specific measures on steel, aluminum, and cars that are not made in the US.
“Tough” negotiations
The statement caused the markets to plummet, and a few days later, the US president declared he would maintain the sector-specific restrictions while reducing the higher taxes to 10 percent for a 90-day break to facilitate trade talks.
Since then, Trump has announced a deal with China to lower unreasonably high tariffs and punitive measures for 90 days, as well as a deal to permanently remove some sector-specific tariffs on Britain.
The talks between the United States and the EU have failed to make much progress, with Brussels recently threatening to hit US goods worth nearly 100 billion euros ($113 billion) with tariffs if it does not lower the duties on European goods.
In his early morning social media post on Friday, Trump said the EU had been “formed for the primary purpose of taking advantage of the United States on TRADE,” and took a swipe at the “difficult” negotiations taking place.
An EU spokesperson declined to comment on the threats of new tariffs, telling AFP that a call was set to take place later Friday between EU Trade Commissioner Maros Sefcovic and US Trade Representative Jamieson Greer.
– US-made iPhones ‘not feasible’ –
The pressure on Apple CEO Tim Cook to do more to bring manufacturing jobs back to the United States from Asia was rekindled by Trump’s recent criticism of the company.
The issue is that reshoring iPhone production to the US “is a fairy tale that is not feasible,” according to Dan Ives, an analyst at Wedbush Securities.
In a letter to clients, he stated, “This would result in an iPhone price point that is a non-starter for Cupertino and translate into iPhone prices of ~$3,500 if it were made in the US.”
He went on to say that this “is not realistic” and that moving production to the US may take up to ten years.
About The Author
