The US tech industry has welcomed the 'phase 1' trade deal signed with China and called for further efforts to ease trade barriers for the sector. The agreement signed by US president Donald Trump will reduce import tariffs on key tech products and also commits China to doing more to enforce intellectual property protection.
According to the Consumer Technology Association, the phase 1 deal rolls back tariffs on List 4A products, including smart speakers, wireless headsets and earbuds, TVs and smartwatches, from 15 percent to 7.5 percent. It also confirms the suspension of planned hikes in tariffs on list 4B products, including laptops and tablets, video game consoles and smartphones. Tariffs on Lists 1-3 products, such as desktop PCs, chargers, power adapters and connected thermostats, remain in place.
The 18-month trade war launched by the US against China has cost the consumer tech industry a total of USD 17.5 billion, the industry group estimates. That includes USD 1.7 billion in additional taxes on 5G products and components. The total tariff bill on tech products swelled to over USD 2 billion per month this autumn, compared to USD 150-200 million before the new rates were imposed.
The CTA warned that tariff costs will remain high even after the phase 1 deal. "We look forward to working with the administration to ensure effective enforcement of the Phase One agreement and the shift to a Phase Two deal—one we hope will eliminate special tariffs on Chinese imports once and for all."
The Internet Association also welcomed the agreement, while saying enforcement will be key to ensuring the deal is a success. "This deal will help to limit market access barriers for American internet companies and better protect innovative US intellectual property. We hope this agreement will ultimately result in the easing of harmful tariffs while creating enforceable rules around cyber intrusions, forced technology transfers, and other aspects of China’s intellectual property policy. We look forward to reviewing the final text of the deal to ensure it includes substantive and enforceable commitments to structural changes."
