Experts studying global trade say the comprehensive tariffs announced by U.S. President Donald Trump on Wednesday will have a ripple effect across the technology industry. These measures include at least 10% tariffs on all countries, as well as huge import tariffs in key U.S. trading allies such as Europe, China, Vietnam, India and South Korea, and issued shares in after-hours transactions.
CNBC reported that Meta and Nvidia share prices fell about 5% per share, while Apple and Amazon fell 6%. iPhone manufacturers make about half of their revenue by selling phones made in China and India, while some of their other products are made in Vietnam. Amazon’s online shopping market also relies on goods sold by third-party merchants in China.
These market declines may just be the beginning. Many economists warn that the White House has begun one of the biggest shifts in global trade in decades, with the consequences likely triggering higher U.S. consumer prices and more inflation. Earlier this week, Goldman Sachs raised the likelihood of a U.S. recession in the next 12 months to 35%, higher than 20%.
“There is an idea that consumers are willing to pay higher prices for American goods,” said Tibor Bersedes, a trade expert and professor at the Georgia Tech School of Economics. “There is no evidence that it happened.”
Bersedes added that one of the reasons Americans said they voted for Trump was because they were upset with inflation during the Biden administration and he could not imagine they would be happy with the price that could rise now.
Some new country-specific tariffs, such as those imposed in the UK, Chile and Brazil, are relatively low. Others, such as those who are levied in China, Cambodia, Vietnam, Taiwan, India and Thailand, range from 26% to 49%. (Trump even targets islands that are not independent countries, some without exports or human inhabitants.)
At least for now, Trump has exempted a crucial technology import measure: semiconductors. This means that American companies like NVIDIA include advanced chips made by Taiwan Semiconductor Manufacturing Corporation (TSMC) into their AI graphics processing units without having to pay Trump’s 32% tariff on Taiwan. However, it is not clear whether TSMC will still be subject to blanket restrictions, and Trump has also announced a 10% tariff. Overall, according to an estimate, about 44% of logic chips come from Taiwan.
In the technology sector, Trump’s tariffs could hit e-commerce the biggest blow. “Online retailers will feel pain, and so will consumer device brands,” said Ian Bremmer, a political scientist and founder and president of consulting firm Eurasia Group.
In addition to introducing comprehensive tariffs, Trump also signed an executive order on Wednesday ending a trade loophole from China and Hong Kong that allows U.S. consumers to import goods directly into the U.S. at $800 without paying any fees.
