Biden Administration to Revive Trump-Era Tariffs on China-made GPUs and Motherboards

[AleksandarK]

The US Trade Representative (USTR) under Biden administration is preparing to reinstate tariffs on certain technology products imported from China, including GPUs and motherboards. The 25% duties, initially imposed by the Trump administration in 2019 but later suspended, are being revived as part of broader efforts to address concerns over China's economic and trade practices. The tariffs are intended to protect American companies from what the administration describes as unfair Chinese trade actions like intellectual property theft and forced technology transfers that undermine U.S. competitiveness. While no specific effective date was provided, the reinstated tariffs are expected to impact major Chinese computing component suppliers significantly. The revival of the Trump-era tariffs marks a reversal from the previous administration's move to temporarily suspend the duties in 2020 as a goodwill gesture during broader trade negotiations with Beijing.

However, those talks ultimately stalled amid the COVID-19 pandemic and rising bilateral tensions over economic and national security issues. Industry groups have expressed concerns that reviving the tariffs could disrupt tech supply chains, increase costs for U.S. companies and consumers, and potentially invite further Chinese retaliation. The tariffs would apply to GPUs, motherboards and other computing components assembled in China regardless of whether the raw components themselves originated from the country. With tensions already elevated over issues like Taiwan and advanced semiconductor production, the tariff announcement could set the stage for further economic friction between the world's two largest economies absent a negotiated resolution on tech trade.



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[ty_ger]

My understanding is that previous tariffs were not just supposed to decrease consumers' incentive to buy from China, but also the money collected was supposed to go into a fund be used to boost local manufacturing. What happened to that money? Has it gone to Intel, TSMC, Apple, or anyone else for those purposes? Will the new tariffs collected be similarly set aside for specific purposes?

 

[dragontamer5788]

Good job threading the needle with this post. Informative, fair, factual.

I still expect the comments here to degenerate into politics and possibly force the closure of the topic. This is a very heated political arena right now after all.

 

[A Computer Guy]

Good job threading the needle with this post. Informative, fair, factual.

I still expect the comments here to degenerate into politics and possibly force the closure of the topic. This is a very heated political arena right now after all.

Might as well freeze the thread now before it devolves into chaos.

 

[mb194dc]

It's all aimed at the election...

It may further hit home though, that despite the big superficial differences. It won't actually make much difference if it's Trump or Biden in the White House...

 

[LabRat 891]

More Made in Taiwan, Malaysia, India, Korea, and Japan, please and thank you.

 

[ExcuseMeWtf]

Clearly, stuff isn't expensive enough as is /s

 

[erocker]

Not as awesome as getting rid of trade with this country all together but I'll take it.

 

[THANATOS]

Not as awesome as getting rid of trade with this country all together but I'll take it.

If US stops trade with China, then what? China will also stop trading with USA. How will that actually help?

P.S. I am also in for deactivating comments for this news, It will turn into a political debate.

 

[Event Horizon]

Prices rose back then and they'll rise now.

 

[64K]

If US stops trade with China, then what? China will also stop trading with USA. How will that actually help?

P.S. I am also in for deactivating comments for this news, It will turn into a political debate.

China can't stop trading with the US or it would absolutely destroy their economy and probably lead to anarchy in China.

 

[damric]

because tariffs and sanctions have worked so well in the past that we have a thriving domestic industry where everything we want to buy is made here

 

[THANATOS]

China can't stop trading with the US or it would absolutely destroy their economy and probably lead to anarchy in China.

And US can stop? Why do you think It's only one way?
If China or US stops all the imports to US, who will replace them? Will USA start producing everything they imported? Will be Americans willing to accept the raised costs etc.
I just don't understand comments like yours, where you are so sure China is dependent on USA, but USA is not on China.

 

[64K]

And US can stop? Why do you think It's only one way?
If China or US stops all the imports to US, who will replace them? Will USA start producing everything they imported? Will be Americans willing to accept the raised costs etc.
I just don't understand comments like yours, where you are so sure China is dependent on USA, but USA is not on China.

The US can't stop either. Why did you draw that conclusion from my simple post?

 

[dragontamer5788]

If US stops trade with China, then what? China will also stop trading with USA. How will that actually help?

P.S. I am also in for deactivating comments for this news, It will turn into a political debate.

It will force US companies to build manufacturing at home, as well as increasing prices in our country.

But us being in control of more manufacturing / factories is a good thing, even if it costs us more. Especially as we come up to geopolitical concerns regarding China.

 

[THANATOS]

The US can't stop either. Why did you draw that conclusion from my simple post?

Maybe because you only wrote A, but not B.

 

[Scircura]

Prices rose back then and they'll rise now.

I get the impression that fewer of these components destined for US markets are made in China now, compared to 5 years ago. US administrations have made noises for almost a decade now that they want to reduce dependence on Chinese tech fabrication and assembly, and so manufacturers have had time to shift some production out of mainland China. Is this true?

 

[THANATOS]

It will force US companies to build manufacturing at home, as well as increasing prices in our country.

But us being in control of more manufacturing / factories is a good thing, even if it costs us more. Especially as we come up to geopolitical concerns regarding China.

I don't really have a problem with It as I don't really believe in globalization, It was always good only for the ones, who had an advantage.
I wish EU did the same, because I think EU is too reliant on US or China and I don't like It one bit.
If you are too reliant on anyone, that's never a good thing.

 

[Lew Zealand]

It will force US companies to build manufacturing at home... <snip>

It will force US companies to build manufacturing in the cheapest of the remaining 190 countries around the planet.

There are more than 2 options out there.

 

[evernessince]

It's all aimed at the election...

It may further hit home though, that despite the big superficial differences. It won't actually make much difference if it's Trump or Biden in the White House...

It goes without saying that all actions by politicians are done to get re-elected, otherwise you don't live in a democracy.

Prices rose back then and they'll rise now.

Prices of current PC parts already include costs to move production away from China and past tariffs as both were happening during the pandemic.

If companies raise prices again it would be nothing more than price gouging as those costs are already factored in.

If US stops trade with China, then what? China will also stop trading with USA. How will that actually help?

P.S. I am also in for deactivating comments for this news, It will turn into a political debate.

The US is a service based economy while China is a manufacturing based economy. The US accounts for a massive part of China's economy where as the reverse is not true. The point is that if China is going to be a bad actor in the world, it's going to be punished for it.

because tariffs and sanctions have worked so well in the past that we have a thriving domestic industry where everything we want to buy is made here

They did accelerate company plans to move out of China. We are seeing massive investment in Vietnam and Mexico based production. As usual people are looking at policy as if it has an immediate impact. No, almost all policy takes time to have an impact and that impact often has a long tail.

And US can stop? Why do you think It's only one way?
If China or US stops all the imports to US, who will replace them? Will USA start producing everything they imported? Will be Americans willing to accept the raised costs etc.
I just don't understand comments like yours, where you are so sure China is dependent on USA, but USA is not on China.

Any number of countries can replace China as a manufacturer. It just requires investment to develop the infrastructure and skills in the specific locality. Something that the rise is Chinese labor costs and tariffs further incentivize.

It will force US companies to build manufacturing at home, as well as increasing prices in our country.

But us being in control of more manufacturing / factories is a good thing, even if it costs us more. Especially as we come up to geopolitical concerns regarding China.

Not at home per say, that's what the CHIPs act is for. Tariffs will just encourage production anywhere but China.

It wouldn't necessarily cost more either. Upfront investment costs are obviously a factor in new manufacturing hubs but beyond that labor in other 3rd world countries is significantly cheaper than China. China hasn't been cheap in a long time as labor costs continue to increase there.

I get the impression that fewer of these components destined for US markets are made in China now, compared to 5 years ago. US administrations have made noises for almost a decade now that they want to reduce dependence on Chinese tech fabrication and assembly, and so manufacturers have had time to shift some production out of mainland China. Is this true?

The primary driver of companies actually moving production out of China was the pandemic where China's policies made business difficult to impossible. The tariffs are just further motivation. We are past the initial hump needed to get the ball rolling and I expect manufacturing jobs to continue to move out of China. China needs to transition to a services based economy. This doesn't mean they get rid of manufacturing, it means their economy has a greater capacity to consume it's own products. Think of it as an additional layer to the economy. Just as an example, the services sector produces 98% of the jobs in the UK and yet their manufacturing input has been increasing year over year. It's a well known economic model that successful countries transition from agriculture then manufacturing then services in that order.

I don't really have a problem with It as I don't really believe in globalization, It was always good only for the ones, who had an advantage.
I wish EU did the same, because I think EU is too reliant on US or China and I don't like It one bit.
If you are too reliant on anyone, that's never a good thing.

All countries apply some sort of surcharge on foreign products to protect domestic markets. China for example applied a 50% tariff on western cars for a long time in order to grow it's domestic car market. That figure today is much lower but in general other countries tend to accept higher export costs to developing countries because otherwise their domestic industries would be overrun.

 

[Denver]

I have no word but dumb to describe this.

 

[pattesatan]

Okay, US will get the short stick from this, Harley Davidson moved outside US last time, how many companies will do it now?

 

[thesmokingman]

Wtf, you mean I can't make my X widgets cheaply and flood the market? Are you high?

 

[ty_ger]

Prices rose back then and they'll rise now.

Whenever there is an excuse to raise prices, they go up. Funny thing is that they don't go back down afterward.

 

[the54thvoid]

because tariffs and sanctions have worked so well in the past that we have a thriving domestic industry where everything we want to buy is made here

Tariffs had nothing to do with that. Free trade and capitalism allowed companies to return greater profits to shareholders by reducing costs via outsourcing to poorer nations. It was the incentive to reduce labour costs that took manufacturing outside the US. The precedent for this goes back to the start of globalism in the eighties.

I'm in favour of nationalist manufacturing policies to protect homegrown industry, assuming it is beneficial to the nation. Unfortunately, modern capitalism isn't about what's good for the nation, rather what's best for investors (which also include pension investments.)

It's never as black and white as the triggered zealots try to make you believe.