China retaliates against US taxes with 84% tariffs, Middle Kingdom strikes back again

Following the new taxes decided by Donald Trump, Beijing has just announced an equally brutal response. American products will now be overtaxed by 84%. A trade shock that risks driving up prices in the tech sector.

The trade escalation between the United States and China is reaching a new milestone. As the new US tariffs came into effect today, Beijing announced an immediate response. American products will now be subject to an 84% surcharge, equivalent to that imposed by Washington on Chinese imports. This response could have lasting consequences on the prices of technology products, particularly for smartphones, consoles, and computers manufactured or assembled in this country.

In detail, China is applying a 50% tax, which is in addition to a previous increase of 34%. In addition, Beijing has added 12 American companies to its export control list. This means that certain dual-use components – civil and military – will no longer be able to be shipped to them. This decision comes just days after Donald Trump unilaterally increased customs duties on several countries, including his allies. As a reminder, the United States now applies up to 104% cumulative taxes on certain Chinese products.

The new taxes are already Rising prices of electronic devices

This new confrontation is part of a context of accelerated deglobalization. As we recently pointed out, US surtaxes and the subsequent retaliations make tech products much more vulnerable to inflation. Apple, for example, had already taken emergency measures by chartering planes to circumvent the increase before it came into effect. But these temporary solutions will not last. The future iPhone 17, largely produced in China, could cost up to 40% more according to some estimates. In Europe, we expect gradual price increases on all products imported from the United States or impacted by their supply chain.

The European Union has also decided to react. This Wednesday, April 9, Brussels approved a plan targeting €20 billion worth of American products. Sectors such as agri-food, textiles, plastics, electrical equipment, and motorcycles are directly affected. Part of the surcharges will come into effect as of April 15, with the rest to follow in the coming months. These measures could eventually include technology products, particularly if Washington maintains its duties on steel, aluminum, or automobiles. Tariffs could therefore increase on certain American products sold in euros, particularly computers and accessories.

In the meantime, manufacturers and retailers of tech products must deal with growing trade instability. Users risk seeing their bills rise, or having to turn to less affected alternatives. The trend toward refurbished products, or extending the lifespan of devices, could further accelerate.