The Trump administration has decided to exclude smartphones and other consumer electronics from its significant “reciprocal” tariffs, providing a notable benefit to major technology companies as the White House seeks to stabilize global markets in the wake of a wide-ranging trade conflict. A notice released by Customs and Border Protection late on Friday confirmed that items such as smartphones, routers, chipmaking equipment, wireless earphones, and some computers and laptops would not be subjected to the reciprocal tariffs, which include the 125 percent levies imposed by Donald Trump on Chinese goods.
This exemption represents a major achievement for companies like Apple, Nvidia, and Microsoft and comes after a turbulent week in U.S. financial markets following Trump’s initiation of a trade war on April 2, known as “liberation day.” The announcement resulted in a significant downturn in global stock markets.
This move marks the first indication of any reduction in Trump’s tariffs against China, which were intensified over the previous week, although he paused the most severe “reciprocal” tariffs while maintaining 10 percent tariffs on various trade partners. Prior exemptions from the administration’s tariffs had been granted to several sectors, such as semiconductors and pharmaceuticals, yet Trump has indicated intentions to implement tariffs on these sectors in the future.
The exemption for smartphones and computers is particularly advantageous for Apple, whose supply chain is largely based in China. Analysts estimate that around 80 percent of iPhones are manufactured in China, though the company has been trying to diversify production to India. A significant portion of iPhones is produced in a large factory complex in Zhengzhou by Apple’s manufacturing partner, Foxconn. Workers there have reported normal operations but expressed concerns over the trade war’s impact.
Following Trump’s announcement of reciprocal tariffs, shares in the American tech giant experienced a substantial decline, with Apple’s market value dropping by approximately $700 billion over several days. Earlier, Trump had mentioned the possibility of excluding U.S. companies from his tariffs but emphasized these decisions would be made “instinctively.”
Chad Bown, a senior fellow at the Peterson Institute for International Economics, noted that the exemptions align with similar ones granted for smartphones and consumer electronics during Trump’s previous trade wars in 2018 and 2019. Bown suggested it remains to be seen if these exemptions will persist or if the president might reverse the decision in the future.
US Customs and Border Protection directed inquiries about the ruling to the US International Trade Commission, which did not immediately comment. Trade attorneys have stated that these new exemptions do not appear to pertain to the 20 percent tariffs on all Chinese imports implemented by Trump in response to China’s involvement in fentanyl production.
The White House did not provide any comments, and Apple also declined to comment. Economists have expressed concerns that Trump’s broad tariffs, which affect many common US consumer products, could exacerbate US inflation and harm economic growth. New York Federal Reserve Chief John Williams indicated that US inflation might rise to 4 percent because of Trump’s tariffs. Additional reporting was provided by Michael Acton in San Francisco.
