Protectionist pressures and incentives for industrial relocation. It is the strategy adopted by Donald Trump to safeguard the big tech and national production. The President of the United States has announced the introduction of duties of 100% on all the semiconductors imported to the United States, but has simultaneously offered exemptions to technological companies that undertake to produce domestic. The result was a succession of cascade of commercial agreements with which Big Tech are trying to free themselves from Trump’s duties.
Nvidia and Advanced Micro Devices
Only in the last few days, the White House has confirmed that two US chip producers, Nvidia and Advanced Micro Devices will be authorized to sell advanced chips at China in exchange for a 15% reduction in the revenues of the US government in the Asian country.
Apple announces 100 billion investments in the USA
Apple’s CEO, Tim Cook, recently announced the intention to increase the company’s investment commitment in the United States to 600 billion dollars in the next four years. “This is the greatest investment that Apple has ever made in America and in the world” announced Trump. In detail there is a new production program to bring a larger part of Apple’s supply chain to the United States. Apple has already announced 500 billion dollars for production in the USA in the next four years, including a new server production plant in Houston, an academy for suppliers in Michigan and further investments with national suppliers. The current 100 billion dollars would bring the total commitment of Apple to 600 billion dollars. Apple has long been considered one of the most vulnerable big tech companies to latent commercial tensions between the United States and China.
The obligatory strategy of the big tech
“The race to the agreements is an attempt to obtain lighter treatment from duties – said Paolo Pescatore, PP Foresight technological analyst, in an interview with CNBC -. In one way or another, all large technological companies have been affected negatively by the duties. They cannot afford to pay millions of dollars in additional commissions that will further affect the profits, as highlighted by the recent profits. quarterly “. Second fisherman – reports CNBC – “Apple, opening the way for his accelerated investments in the United States, will probably trigger a domino effect” in the sector “. The agreement between Nvidia and AMD with the Trump administration has, in the meantime, unleashed a heated debate on the potential impact on the activities of the chips giants and on the possibility that the US government is looking for similar agreements with other companies. In his analysis CNBC – “They described the agreement as a fight, while others hypothesized that it could even be unconstitutional, comparing it to a tax on exports”. The payment of 15% of the revenues of chip sales in China in the United States government as “bizarre”.
Concerns of investors
Although initially investors have accepted the agreement as amply positive both for Nvidia and for AMD, which again ensure access to the Chinese market, Wang has said that some operators in the sector will still be worried. “As an investor – Wang said to CNBC – are you worried why, in this case, is it an arbitrary decision of the government? Every president can play a decisive role in these agreements?”.
