Trump's duties will hit Apple's business hard: the company's shares reacted by falling

Donald Trump has announced new duties that will affect goods from almost all countries (and, of course, bypass the terrorist country Russia!). The minimum duty for all US trading partners is 10% and reaches 49% for Myanmar, 46% for Vietnam, 34% for China, 32% for Taiwan, 26% for India and 24% for Japan. The US President justifies his actions by taking care of the country's economy and incentivising citizens to buy domestic goods, but for now big business is in shock and has to restructure operations. The results of the tariff war are still a long way off, but stocks are falling right now.

Here's What We Know

After Trump's speech, the US stock market instantly reacted with a $2 trillion drop and this trend continues.

So, the most expensive company in the world Apple got a huge problem. For many years, the American giant has dispersed its production facilities in Taiwan, Europe, India, China and the countries of southeast Asia, but because of the new duties, such co-operation turns out to be economically unprofitable. For example, Taiwan is where Apple's Silicon processors, which are used in all of the company's devices, are manufactured. Apple will face a dilemma: either move all production to the U.S., but it is not so easy to do, or raise the cost of its goods, making them less competitive in the market.

Investment agency Morgan Stanley has estimated that imports from China alone would cost Apple an additional $8.5bn a year!

In Trump's first administration, Apple received an exemption in the US tariff policy, but now the president has said that no other company will get any more favours.

Amid such news, Apple shares fell 7.5 per cent in the post-trading session.

Source: MacRumors