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On April 3, USTR has published a list of Chinese exports targeted for tariffs. A 25% tariff would be applied to all the products, to recoup losses on technology. The global market research firm TrendForce has sorted out the list and given a comprehensive analysis on the effect on China’s technology industries.
The list of 1,300 Chinese products, worth USD50 billion, targeting at ten emerging and high-tech industries listed in the Made in China 2025 plan, such as aerospace, information and communication technology, machinery, energy, smart vehicle and healthcare. The related products include LED, PCB, laser gear, semiconductor equipment, capacitance, resistance, thyristor diode, TV and other components and parts.
On the whole, the proposal would have limited impact on China’s high-tech industries. In terms of several items, the progress of technology would be delayed. Moreover, the increase of tariffs may lead to related consumer goods price rising and a decline in purchasing power.
America to thwart China’s Ambition of IC Industry
Integrated circuit is one of the key fields in the trade war between America and China. According to the analysts from TrendForce, the list had a limited impact on China’s semiconductor industry.
Specificly, the semiconductor equipment covering platin, electrophoresis, electrolysis, PVD and cleaning were put on the list, accounting for only a small proportion of all the IC products that China exports to the US market. Thus the influence could be negligible.
In terms of capacitance and resistance, the exports to America account for less than 10%. The impact on China companies is relatively limited, as there is no new capacity in the short term, and the shortage and price rising continue.
In fact, China’s semiconductor industry is at the early stage of promoting indigenous production. As the target market is still in China for quite some time, we won’t see a noticeable change in the export data in a very short period of time.
However, TrendForce points out that the list manifests America’s growing concern over China’s technology industries, expecially IC industry. We should attach importance to the obstacle.
We are not sure how these tariffs could continue, but we know the further talk would be the balance between America and China over their concern and appeal.
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