FirstFT: Trump warns US tech tariff exemption shall be short-term

Good morning and welcome again to FirstFT Asia. In right this moment’s publication:

• Large Tech’s hopes for a tariff reprieve dealt a blow

• A British MP is denied entry to Hong Kong

• India’s maritime ambitions in Africa

Donald Trump has signalled that smartphones and different client electronics imported to the US would face tariffs, dealing a blow to hopes of a reprieve for Large Tech firms reminiscent of Apple, Nvidia and Microsoft.

What occurred: Trump wrote on social media: “NOBODY is getting “off the hook” for the unfair Commerce Balances, and Non Financial Tariff Boundaries, that different Nations have used in opposition to us, particularly not China which, by far, treats us the worst!”

His administration this weekend excluded telephones, chipmaking gear and sure computer systems from steep “reciprocal” tariffs in what was a big enhance for tech teams whose shares plunged after the president unleashed a world commerce struggle on “liberation day”. However yesterday, US officers performed down the exemptions, warning that such merchandise can be re-examined as a part of a authorities probe into semiconductors, which face a separate spherical of tariffs.

“What he’s doing is he’s saying they’re exempt from the reciprocal tariffs,” mentioned US commerce secretary Howard Lutnick, referring to Trump. “But they’re included in the semiconductor tariffs, which are coming in probably a month or two.”

A let-down for Large Tech: Lutnick and Trump’s feedback deal a blow to hopes of a reprieve for firms reminiscent of Nvidia, Microsoft and Apple, which makes about 80 per cent of its iPhones in China, based on analyst estimates. Trump’s administration has asserted that Apple can construct iPhones within the US as a part of its push to revive American manufacturing. However consultants say this might be unrealistic given the corporate’s deep provide chain ties to China and South east Asia.

Within the quick time period, Apple has as a substitute pivoted to its second iPhone manufacturing base, India, the place it appears prone to face decrease tariffs than in China.

Wall Avenue worries: Ray Dalio, the billionaire founding father of hedge fund agency Bridgewater Associates, warned yesterday that Trump’s tariffs had been “very disruptive”. Talking on NBC yesterday, Dalio mentioned: “I think that right now we are at a decision-making point and very close to a recession . . . And I’m worried about something worse than a recession if this isn’t handled well.”

Daniel Ives, international head of know-how analysis at Wedbush Securities, advised the FT: “The mass confusion created by this constant news flow out of the White House is dizzying for the industry and investors and creating massive uncertainty and chaos for companies trying to plan their supply chain, inventory, and demand.”

Learn the complete story right here — and comply with Trump’s newest strikes with our tariff tracker.

• The Chinese language items People most depend on: Smartphones and laptops are actually exempt from Trump’s tariffs, however online game consoles, electrical followers and toys are nonetheless topic to 125 per cent levies.

• Opinion: China is nicely positioned to climate Trump’s commerce struggle, writes Arthur Kroeber, founding associate and head of analysis at Gavekal Dragonomics.

• ‘Stuff should be made here’: Firm homeowners in Ohio say Trump’s measures can set off a renaissance in US manufacturing.

Right here’s what else I’m conserving tabs on right this moment:

• Financial information: China publishes a batch of commerce information and Singapore releases its advance first-quarter GDP estimate.

• Xi Jinping excursions south-east Asia: The Chinese language chief go to Vietnam right this moment, earlier than travelling to Malaysia and Cambodia, as Beijing seems to be to strengthen ties in export-reliant economies rattled by Trump’s escalating commerce struggle. 

• Singapore financial coverage assertion: The Financial Authority of Singapore is predicted to loosen coverage, based on analysts polled by Reuters.

5 extra prime tales

1. A Russian ballistic missile strike on the northeastern Ukrainian metropolis of Sumy has left at the very least 34 civilians useless and 117 injured, based on President Volodymyr Zelenskyy and authorities officers. The strike hit as Ukrainians celebrated Palm Sunday and got here lower than a day after Trump’s particular envoy Steve Witkoff met President Vladimir Putin to debate bringing his full-scale struggle to an finish.

2. Hong Kong has barred a British member of parliament from getting into the Chinese language territory, including uncertainty to UK-China ties simply because the Labour authorities seeks to step up bilateral financial relations. Wera Hobhouse, a Liberal Democrat MP, mentioned she was refused entry upon arrival to Hong Kong this week with out particular causes offered by authorities. Learn extra concerning the incident.

3. A number of the world’s greatest pension funds are halting or reassessing their personal market investments into the US, saying they won’t resume till the nation stabilises after Trump’s erratic coverage blitz. High Canadian and Danish funds are rethinking their publicity to the US due to tariffs and discuss of territorial enlargement.

4. A Bangladeshi arrest warrant has been issued for former UK Metropolis minister Tulip Siddiq over allegations that she abused political energy to unlawfully purchase land in an upscale township close to Dhaka. A court docket issued the warrant for Siddiq, alongside her mom Sheikh Rehana, her aunt and former prime minister Sheikh Hasina, and different family members, an official on the Bangladesh Anti-Corruption Fee advised the FT. Listed here are extra particulars.

5. A distant gold and copper mine beneath a volcano in south-west Pakistan may present key leverage for commerce talks with the US, based on its operator. Tim Cribb, challenge director of Barrick’s Reko Diq mine, mentioned the strategic steel useful resource “ticks a lot of boxes” for the Trump administration and will assist Islamabad cut back “reciprocal” tariffs initially set at 29 per cent.

Information in-depth

India has launched its biggest-ever joint naval train with African nations, a part of a push to spice up its affect on the continent and presence within the Indian Ocean, the place China is exercising rising industrial and army clout. The Indian Navy has performed a rising function in counter-piracy operations, serving to challenge the nation as a regional safety energy. However these ambitions needs to be “tempered with realism”, analysts mentioned.

We’re additionally studying . . . 

• Lunch with the FT: Former UK prime minister Theresa Might discusses tariffs, Boris Johnson’s manoeuvring — and the time Trump held her hand.

• Digital economic system: The explosion of storage models world wide exhibits that digital possessions won’t ever match the attachment felt for issues in the true world, writes Elaine Moore.

• The top of American exceptionalism: The US can pay a market penalty for Trump’s turmoil, writes Rana Foroohar.

Chart of the day

The US and China’s dizzying tariff tit-for-tat has been a “boon” for Brazil’s agricultural sector. Latin America’s largest economic system is poised to increase its lead over the US as China’s prime meals provider as American farmers plead with Trump to make a take care of Beijing.

Take a break from the information

Go inside Japan’s most stunning bathhouses with HTSI’s Clara Baldock. These bastions of conventional residing are buoyant as soon as once more as efforts to protect, revitalise and have a good time their cultural worth have put them again at the centre of communal life.