President Trump imposed a new round of tariffs on $16 billion in Chinese goods on Thursday. That's on top of $34 billion in tariffs he announced in July. But this new round of economic sanctions has caught the attention of Oregon's high-tech chip industry.
This time, several products related to semiconductor production are on the list. It particularly hits products that are used in semiconductor manufacturing equipment.
Mike Rogoway covers the technology industry for The Oregonian/OregonLive. He told OPB “Weekend Edition” host John Notarianni that China isn’t likely to retaliate against the electronics industry directly.
“They badly want our electronics,” Rogoway said. “They’re trying to develop their own electronics industry and to do that they need equipment and chips made in the United States.”
Since electronic components are often made here and then shipped to Asia to be assembled, Rogoway said we’re essentially levying tariffs against products that were made in Oregon.
“The semiconductors that Intel makes in Hillsboro, they go over to Asia and then they come back to the U.S. in chips,” he said.
Rogoway also noted there’s a risk the added complexity of tariffs could eventually lead manufacturers to scrap production in the U.S.
“The worst case scenario might be that someone says, 'Well, it’s easier to just do the whole thing in China and then import it back afterwards.' Then production could get consolidated somewhere other than Oregon down the road,” he said.
He pointed out that the opposite could just as well happen: The threats of trade barriers could actually eventually lead to smoother negotiations and a better trade relationship going forward.
“Right now, the U.S. and China are making noise about talking to one another while still levying tariffs, so it’s really hard to tell,” Rogoway said.
Hear the full conversation by using the audio player at the top of this article.