China raises tariffs on US goods to 125% and says it won't respond any further
bbc.com
bbc.com
https://semianalysis.com/2025/04/10/tariff-armageddon-gpu-lo...
If assembly moves to Canada or Mexico, their much lower tariffs on foreign components should apply, so their governments would have a share of GPU revenue from sales of GPUs in the US.
Finally, because the components will be tariffed if imported into the U.S. for assembly, the effect of U.S. tariffs makes it cheaper to build things in Mexico and Canada, which seems contrary to their purpose.
Quoting the linked article:
> as long as his March 7 executive orders remain in effect
Good luck. Everything is changing every day with this US government.
It's largely complicated.
What is assembled in China? A graphics card (or anything) is made up of many smaller parts. Some of it might have US-based parts, made up of non-US based parts. Tariffs happen on import (when someone buys something). So for each part this would need to be paid too.
That aside, if you ask me, the cheapest way is to get rid of US jobs. Remove the US parts so you have a 100% non-US product. 0% tariff so far. For US-only sales have it assembled shipped to a country like Singapore or Australia with 10% tariffs to package and re-label. When you ship from say Singapore to US, the buyer fills in the tariff code with country of origin Singapore. Case closed. 10% tariffs.
i.e. are you sure US wins?
What's next? Inspect every import to verify its country of origin? It'd clog up the ports.
Since Trump's 1st tariff on China, 100s of billions have been imported without tariffs. It's happening and continues to happen.
That aside, if you ask me, the cheapest way is to get rid of US jobs. Remove the US parts so you have a 100% non-US product. 0% tariff so far. For US-only sales have it assembled shipped to a country like Singapore or Australia with 10% tariffs to package and re-label. When you ship from say Singapore to US, the buyer fills in the tariff code with country of origin Singapore. Case closed. 10% tariffs.
https://semianalysis.com/2025/04/10/tariff-armageddon-gpu-lo...
It is unclear how removing U.S. components from products would reduce U.S. tariffs.
Excluding your “remove US components idea”, it is clear to me that China is losing in such a scenario, since they cannot tariff the non-Chinese components anymore and the Chinese components would be subject to tariffs in the country of assembly. To be clear, I do not know to what extent they enforce tariffs on non-Chinese components, but I have read of them placing tariffs imports from other countries, which could affect the components made in those countries.
These only have 10% reciprocal tariffs applied so I used it as the example. Paying 10% is a lot easier than dealing with the Canada and Mexico deal, which is more likely to change.
> It is unclear how removing U.S. components from products would reduce U.S. tariffs.
US components need to pay tariffs since the US cannot produce that component whole in the US completely. Removing them makes it cheaper.
> it is clear to me that China is losing in such a scenario, since they cannot tariff the non-Chinese components anymore
Why do they want that? Who wants tariffs? Every economist says that random use of tariffs has an adverse impact.
China hasn't been paying tariffs to the US either. Most proper engagements have been re-routing. Only US small businesses suffer (since re-routing is harder for small businesses).
Being bad for business, it's more likely now that the economic royalists will find a way to remove POTUS by impeachment and conviction for one of his many alleged crimes by turning COTUS against Dear Leader through economic and political pressure. The billionaire class has a much deeper bench and bigger war chest than the Musk-Trump duumvirate.
Musk has already left the scene...
No, we're at a point where goods won't flow from US to China, not the other way around.
China has found workarounds for getting into the US for a long time e.g. via Canada and Mexico (why they got tariffs from day 1). They will continue to do so.
Considering that the US is also adding tariffs to every other country, which side would they be on?
Not even close to being near that point, much less "beyond".
It simply can't happen (the flow to stop in any significant way) for the foreseeable future of 5-10 years. Trade will continue.
If all such trade was to stop not even now, but even a year from now, It would be Mad Max.
"Many countries in Africa" don't have the infrastructure, manpower, expertise, supply chain, and other factors - and they wont have for the foreseeable future.
If you're talking about sweatshops making clothes and stuff, sure. If you're talking about anything more advanced, that requires factories, technology, complex production lines, etc, nope.
For the foreseeable future, things will just get expensive and/or be consumed less.
You'd be lucky if you get "only modestly quite more expensive" alternatives.
By the way, I believe the de minimis exemption is still in effect until May 2, so until we get close enough to the deadline for shipments to arrive on May 2 or later, the tariff rate does not apply to small shipments.
US treasuries rates are going up while the dollar index is going down. Unprecedented. I think if Trump/US doesn't massively retract from this position, we are going to see a change of the current economical and monetary order.
― Hemingway, The Sun Also Rises
Without Chinese imports most luxury goods will disappear will be replaced by more expensive and lower quality alternatives.