Skip to comments.Apple could be used as a 'bargaining chip' in the trade war, Chinese state media warns
Posted on 08/07/2018 10:11:57 AM PDT by Red Badger
Apple has benefited from cheap labor and strong supply chain in China which has helped it boost profit and get to a $1 trillion valuation, the state-backed People's Daily said. The U.S. firm should share that money with Chinese citizens, the article urged. Apple could be the target of "anger and nationalist sentiment" amid the ongoing trade war.
Apple has benefited from cheap labor and a strong supply chain in China and needs to share more of its profit with the Chinese people or face "anger and nationalist sentiment" amid the ongoing trade war, an article in the state-backed People's Daily warned Tuesday. The article originally appeared in another state-backed publication, Global Times, last week.
The opinion piece highlights how Apple made $9.6 billion in revenues in China in the June quarter, which helped the U.S. giant to recently hit a $1 trillion valuation.
But the continuing trade war between the U.S. and China could leave Apple and other U.S. firms vulnerable as "bargaining chips" for Beijing, according to the article.
"The eye-catching success achieved in the Chinese market may provoke nationalist sentiment if U.S. President Donald Trump's recently adopted protectionist measures hit Chinese companies hard," the People's Daily said.
"China is by far the most important overseas market for the U.S.-based Apple, leaving it exposed if Chinese people make it a target of anger and nationalist sentiment. China doesn't want to close its doors to Apple despite the trade conflict, but if the U.S. company wants to earn good money in China, its needs to share its development dividends with the Chinese people."
It's unclear how the publication thinks Apple should share its profits with Chinese citizens.
Apple declined to comment.
Last week, China said it was ready to retaliate with tariffs on around $60 billion of U.S. goods, just days after the U.S. administration revealed that Trump had spoken with U.S. Trade Representative Robert Lighthizer and asked him to consider increasing the proposed levies on $200 billion of Chinese goods up to 25 percent, from 10 percent.
So far, Apple has been broadly insulated from the trade war. Trump reportedly told Apple CEO Tim Cook in June that iPhones assembled in China would be spared from levies.
But People's Daily took issue with the economics of the iPhone. The article claimed that Chinese companies in Apple's supply chain only get 1.8 percent of total profits created by the flagship device. People's Daily did not cite where it got this figure from.
Ultimately, Chinese state media argued that U.S. companies could begin to enter the firing line in the conflict between the world's two largest economies.
"The trade conflict initiated by the Trump administration reminds China to re-examine China-U.S. trade," People's Daily wrote. "It seems U.S. companies doing business in China are the biggest winners from China-U.S. trade. The Chinese market is vital for many top U.S. brands, giving Beijing more leeway to play hardball in the trade conflict."
Ruh Roh! (for Apple, anyway)
Interesting.....I thought Apple paid works a salary. Oh I forgot a salary for work accomplished is not the same as "sharing" in today's world.
Maybe we should also scrutinize Chinese-owned Smithfield Foods, a part of the meat oligopoly in this country that keeps meat prices high.
It is statements like that which illustrate the danger of doing business with despotic regimes, of which Red China is one. Everything is hunky dory while money is flowing in, but if they ever want to just grab any foreign assets there (assets such as a larger government slice of profits) they have the means to do so.
Probably won't happen, but rhetoric like that certainly sounds like they would put their hands on our "assets" without too much navel gazing.
That is what I call shooting yourself in the foot. Apple may have HQ in the US that employs a small minority of their global employees but most of the assembler worker bees are in China which has already stolen the technology so that their Chinese competitor selling in China has now exceeded Apple sales in China. I guess Apple was seeing the writing on the wall and started to expand their manufacturing capacity in India, Good for them. American companies are now forewarned to look elsewhere than China in expanding manufacturing operations. Hope this leads to economic chaos in enemy China and the rest of American manufacturers there start looking elsewhere to manufacture product.The reality is the Chinese never intended for US products to penetrate their markets.
I’ve had it with the Chinese government. I remember when Japan was going to be a new world superpower and their economy was going to eclipse ours. Obviously didn’t happen, and if we respond to the threat China has become it won’t happen for them either.
As an aside, imagine if we replaced the pathetic but self-absorbed and arrogant idiots we generally elect into the House and Senate with private sector people who have done real jobs. The US would be much better off, and the economic threat of China would be a distant memory.
All I know is that with road apple in league with the deep state and the chi-coms, I feel a little better about my purchase of an android phone.
With $1 trillion, I’m pretty sure Apple could develop its own nuclear deterrent if it wants to. Xi should watch himself.
"Nice company ya' got here, it'd be a shame if something happened to it"
With maybe a Youngstown Tuneup for one of the key people to drive home the point that it's an unpredictable world where a company needs friends.
Android = Gooooooooogle.....................
Chinese companies have always differentiated between products for export (which has fueled their economic growth), and products for internal consumption (cheaper and affordable to the growing middle class).
They want more of the latter but they can’t get it without more of the former. No one can replace the US in the Chinese economy.
So buy a Samsung like I always do:-)
Does it use the Android OS?
If so, it’s Gooooooogle..............
Yeah, but Samsung is So Korean and they profit the most from Android not Google. But like I said I only feel a little better for having Android.
Interesting that China and the media think anyone would care LOL!
Yeah, but road apple is a %100 sell out to the good ole USA. So screw EM!
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