5 ms·

I'm guessing a ton of new companies will pop up overnight in India, Taiwan, Vietnam, S Korea that simply purchase components from China and resell them to the U

I'm guessing a ton of new companies will pop up overnight in India, Taiwan, Vietnam, S Korea that simply purchase components from China and resell them to the US. Not exactly helping anyone.

aiiizzz 1y ago
The executive order came with threats against any country doing that
- megablast 1y ago
  Is it a country doing it?? Would a country be able to track that??
- vijaybritto 1y ago
  Yeah and it has no effect because its done by companies not countries. This is gonna continue for a long time. Its an incredible time to be a middle man
  - timewizard 1y ago
    I thought a majority of Chinese businesses are state owned. Their neighbors understand the stakes though and have demonstrated eagerness to have low US tariff rates. I assume their customs agencies will be on the lookout for this relabeling strategy. It's going to occur, as it already does occur, for all kinds of reasons, but it's not going to be as simple as you make it out to be. There is a limited capacity to perform this work meaning the costs may not even be competitive with the US tariff in the long run.
    - Retric 1y ago
      > I thought a majority of Chinese businesses are state owned. That’s not how things work, they care about control not micromanaging everything. There are rules favoring majority Chinese owned companies, but that doesn’t need to be government ownership. The CCP only really cares about large companies or specific industries like media. There’s minimal interference in a food truck and thus most companies that are small, but things get more involved as you scale. Critical industries like shipping and electricity have government owned businesses running things.
    - rsynnott 1y ago
      > I thought a majority of Chinese businesses are state owned. Where'd you get that? The state has a significant (though usually less than controlling) ownership stake in about 1.5% of Chinese businesses, and at least _some_ ownership in about 2%. "The state owns some of this" is, of course, not equivalent to "the state meaningfully controls this". But in any case for this sort of activity you'd probably just establish new companies, which the state wouldn't have any share in anyway. And, also, this is kinda academic, because you wouldn't be doing it in China, you'd be doing it in some third country and transhipping goods originating in China.
      - ffsm8 1y ago
        I have never been to China, but you sound informed on the topic - maybe you can weight in on that. I've heard from various YouTube channels covering news about China, it's social issues and shenanigans that all companies above a certain size are required to have someone on staff that's essentially part of the government. These channels are however mostly run by people speaking very good English, so clearly made for the western market. But Googling that information seems to confirm it, too. I.e. > Since 2018, domestically-listed companies are required to establish a party entity. I cannot speak with confidence on the topic, but from an uninformed spectators perspective, it does sound like timewizards argument was correct?
    - mayama 1y ago
      Long term it will work. If foreign govt allow getting around tariffs, according to trump import deficit formula, tariff on the govt will go up. Usgov could also increase tariff on countries with more companies doing tariff shenanigans. The problem is with american 2 year election/midterm cycle no one believes that this will last more then 3-6 months now.
- jillyboel 1y ago
  It's just a few shell companies doing stuff. Good luck stopping them.
- rsynnott 1y ago
  With the exception of command economies (basically just North Korea, these days), this sort of thing would generally be done by companies, not countries. And, y'know, eh, Trump says a lot of things.
whatevermom 1y ago
This will happen in Cambodia. They are building a massive amount of factories near Sihanoukville where the Chinese goods will be stamped with « made in Cambodia » and shipped right away to the USA.
- justinator 1y ago
  A Tariff Holiday in Cambodia you say? heavy surf punk guitar squeals in
  - timschmidt 1y ago
    https://www.youtube.com/watch?v=vatNMshZVfU https://www.youtube.com/watch?v=vatNMshZVfU
    - busyant 1y ago
      I thought you were linking to this: https://www.youtube.com/watch?v=-KTsXHXMkJA https://www.youtube.com/watch?v=-KTsXHXMkJA edit: decades ago, I worked in a lab that was sequencing the genome of the Dengue virus (back when sequencing DNA was a Herculean task)
- latchkey 1y ago
  They've been preparing for this day for many years now. Whole silkroad through Laos and Cambodia to Sihanoukville.
locallost 1y ago
This is a known issue with tariffs, so "governments" are on the lookout for it. It's risky, and there are consequences if you get caught. There were however reports of Chinese companies actually setting up production in e.g. Thailand. The products are more expensive then, so it doesn't actually change anything - at least it was like this before the introduction of the one billion gagillion tariffs.
- chii 1y ago
  > This is a known issue with tariffs, so "governments" are on the lookout for it. not just an issue with tariffs, but with sanctions. Guess how many companies suddenly popped up in places like kazakhstan importing electronic components and other us-sanctioned products, and then selling it to russia.
  - braincat31415 1y ago
    Not too many. The Chinese are not shy about selling sanctioned components directly.
spaceman_2020 1y ago
Apple is shifting its production to India, but in reality, the phones are just assembled in India. All the components are made in China, shipped to India, where they are put together. China still captures 90% of the value
- itake 1y ago
  I don't know the latest, but as of like 6-8 mo ago. India hasn't been able to produce much (anything?), despite having millions of dollars of Chinese equipment ready to be put into use.
  - chrisco255 1y ago
    $2.6B Foxconn factory in India is coming online in the next few days: https://www.ndtvprofit.com/technology/tata-plant-begins-iphone-production-as-apple-eyes-india-amid-trump-tariff-threats-to-china-production https://www.ndtvprofit.com/technology/tata-plant-begins-ipho...
    - itake 1y ago
      "coming online" doesn't necessarily mean producing reasonable number of phones that pass QA
  - oatmeal_croc 1y ago
    Where do you get your information from?
    - itake 1y ago
      Apple employees. They may of been discussing a specific factory or component. I didn't care to pry.
  - mayama 1y ago
    India has been producing mobiles for local consumption for few years now. Sure, almost everything was imported initially. But, recently govt is targeting PLI for specific mobile components like PCB, screen, camera modules, enclosures etc. CPU/SOC still has to be imported though. 10% of apple iphones are already manufactured in India.
JSR_FDED 1y ago
Straightforward circumvention like that isn’t allowed (I’m not saying it won’t work). The new companies you mention would only be entitled to thelower tariffs on the value they add to the product they buy from China.
- lucianbr 1y ago
  But how much visibility can the US government have into what happens between India and China? Especially if they work at hiding this stuff. I'm not saying it will work, I'm just curious. How can you tell how much of a product is made in India vs China if India and China work together to lie to you about it?
  - mayama 1y ago
    Regarding India, Indian govt already has huge tariffs and non tariff barriers on China. They imposed many of those during Galwan valley standoff and later extended them when they are promoting manufacturing or PLI for specific sectors. Indian govt and local Indian manufacturers won't allow middlemen to come and relabel items and eat in to their share of the pie. Sure, with the corrupted Indian bureaucracy some relabling will still go through, but it wont be much. Not sure how US plans to deal with relabling in Cambodia, Mexico etc. though.
miohtama 1y ago
This already happened under Trump I administration. Now they are setting high tariffs on India, Vietnam, as well. Not sure whether it is to close this loophole or not.
oatmeal_croc 1y ago
The interesting thing is that India already has high tariffs for goods coming from China, however this might be different for finished vs non-finished goods and for consumption vs re-export goods. The tariffs aren't cheap though. Iphones not manufactured in India and sold there are significantly more expensive due to all the tariffs.
JumpCrisscross 1y ago
> guessing a ton of new companies will pop up overnight in India, Taiwan, Vietnam, S Korea that simply purchase components from China and resell them to the US The reality in high-tariff economies is simpler: more people just forge customs paperwork.
mystified5016 1y ago
Aliexpress has been routing packages through Africa and other places to dodge tariffs

I'm guessing a ton of new companies will pop up overnight in India, Taiwan, Vietnam, S Korea that simply purchase components from China and resell them to the US. Not exactly helping anyone.

aiiizzz 1y ago

The executive order came with threats against any country doing that

megablast 1y ago
Is it a country doing it?? Would a country be able to track that??
vijaybritto 1y ago
Yeah and it has no effect because its done by companies not countries. This is gonna continue for a long time. Its an incredible time to be a middle man
- timewizard 1y ago
  I thought a majority of Chinese businesses are state owned. Their neighbors understand the stakes though and have demonstrated eagerness to have low US tariff rates. I assume their customs agencies will be on the lookout for this relabeling strategy. It's going to occur, as it already does occur, for all kinds of reasons, but it's not going to be as simple as you make it out to be. There is a limited capacity to perform this work meaning the costs may not even be competitive with the US tariff in the long run.
  - Retric 1y ago
    > I thought a majority of Chinese businesses are state owned. That’s not how things work, they care about control not micromanaging everything. There are rules favoring majority Chinese owned companies, but that doesn’t need to be government ownership. The CCP only really cares about large companies or specific industries like media. There’s minimal interference in a food truck and thus most companies that are small, but things get more involved as you scale. Critical industries like shipping and electricity have government owned businesses running things.
  - rsynnott 1y ago
    > I thought a majority of Chinese businesses are state owned. Where'd you get that? The state has a significant (though usually less than controlling) ownership stake in about 1.5% of Chinese businesses, and at least _some_ ownership in about 2%. "The state owns some of this" is, of course, not equivalent to "the state meaningfully controls this". But in any case for this sort of activity you'd probably just establish new companies, which the state wouldn't have any share in anyway. And, also, this is kinda academic, because you wouldn't be doing it in China, you'd be doing it in some third country and transhipping goods originating in China.
    - ffsm8 1y ago
      I have never been to China, but you sound informed on the topic - maybe you can weight in on that. I've heard from various YouTube channels covering news about China, it's social issues and shenanigans that all companies above a certain size are required to have someone on staff that's essentially part of the government. These channels are however mostly run by people speaking very good English, so clearly made for the western market. But Googling that information seems to confirm it, too. I.e. > Since 2018, domestically-listed companies are required to establish a party entity. I cannot speak with confidence on the topic, but from an uninformed spectators perspective, it does sound like timewizards argument was correct?
  - mayama 1y ago
    Long term it will work. If foreign govt allow getting around tariffs, according to trump import deficit formula, tariff on the govt will go up. Usgov could also increase tariff on countries with more companies doing tariff shenanigans. The problem is with american 2 year election/midterm cycle no one believes that this will last more then 3-6 months now.
jillyboel 1y ago
It's just a few shell companies doing stuff. Good luck stopping them.
rsynnott 1y ago
With the exception of command economies (basically just North Korea, these days), this sort of thing would generally be done by companies, not countries. And, y'know, eh, Trump says a lot of things.

whatevermom 1y ago

This will happen in Cambodia. They are building a massive amount of factories near Sihanoukville where the Chinese goods will be stamped with « made in Cambodia » and shipped right away to the USA.

justinator 1y ago
A Tariff Holiday in Cambodia you say? heavy surf punk guitar squeals in
- timschmidt 1y ago
  https://www.youtube.com/watch?v=vatNMshZVfU https://www.youtube.com/watch?v=vatNMshZVfU
  - busyant 1y ago
    I thought you were linking to this: https://www.youtube.com/watch?v=-KTsXHXMkJA https://www.youtube.com/watch?v=-KTsXHXMkJA edit: decades ago, I worked in a lab that was sequencing the genome of the Dengue virus (back when sequencing DNA was a Herculean task)
latchkey 1y ago
They've been preparing for this day for many years now. Whole silkroad through Laos and Cambodia to Sihanoukville.

locallost 1y ago

This is a known issue with tariffs, so "governments" are on the lookout for it. It's risky, and there are consequences if you get caught. There were however reports of Chinese companies actually setting up production in e.g. Thailand. The products are more expensive then, so it doesn't actually change anything - at least it was like this before the introduction of the one billion gagillion tariffs.

chii 1y ago
> This is a known issue with tariffs, so "governments" are on the lookout for it. not just an issue with tariffs, but with sanctions. Guess how many companies suddenly popped up in places like kazakhstan importing electronic components and other us-sanctioned products, and then selling it to russia.
- braincat31415 1y ago
  Not too many. The Chinese are not shy about selling sanctioned components directly.

spaceman_2020 1y ago

Apple is shifting its production to India, but in reality, the phones are just assembled in India. All the components are made in China, shipped to India, where they are put together. China still captures 90% of the value

itake 1y ago
I don't know the latest, but as of like 6-8 mo ago. India hasn't been able to produce much (anything?), despite having millions of dollars of Chinese equipment ready to be put into use.
- chrisco255 1y ago
  $2.6B Foxconn factory in India is coming online in the next few days: https://www.ndtvprofit.com/technology/tata-plant-begins-iphone-production-as-apple-eyes-india-amid-trump-tariff-threats-to-china-production https://www.ndtvprofit.com/technology/tata-plant-begins-ipho...
  - itake 1y ago
    "coming online" doesn't necessarily mean producing reasonable number of phones that pass QA
- oatmeal_croc 1y ago
  Where do you get your information from?
  - itake 1y ago
    Apple employees. They may of been discussing a specific factory or component. I didn't care to pry.
- mayama 1y ago
  India has been producing mobiles for local consumption for few years now. Sure, almost everything was imported initially. But, recently govt is targeting PLI for specific mobile components like PCB, screen, camera modules, enclosures etc. CPU/SOC still has to be imported though. 10% of apple iphones are already manufactured in India.

JSR_FDED 1y ago

Straightforward circumvention like that isn’t allowed (I’m not saying it won’t work). The new companies you mention would only be entitled to thelower tariffs on the value they add to the product they buy from China.

lucianbr 1y ago
But how much visibility can the US government have into what happens between India and China? Especially if they work at hiding this stuff. I'm not saying it will work, I'm just curious. How can you tell how much of a product is made in India vs China if India and China work together to lie to you about it?
- mayama 1y ago
  Regarding India, Indian govt already has huge tariffs and non tariff barriers on China. They imposed many of those during Galwan valley standoff and later extended them when they are promoting manufacturing or PLI for specific sectors. Indian govt and local Indian manufacturers won't allow middlemen to come and relabel items and eat in to their share of the pie. Sure, with the corrupted Indian bureaucracy some relabling will still go through, but it wont be much. Not sure how US plans to deal with relabling in Cambodia, Mexico etc. though.

miohtama 1y ago

This already happened under Trump I administration. Now they are setting high tariffs on India, Vietnam, as well. Not sure whether it is to close this loophole or not.

oatmeal_croc 1y ago

The interesting thing is that India already has high tariffs for goods coming from China, however this might be different for finished vs non-finished goods and for consumption vs re-export goods. The tariffs aren't cheap though. Iphones not manufactured in India and sold there are significantly more expensive due to all the tariffs.

JumpCrisscross 1y ago

> guessing a ton of new companies will pop up overnight in India, Taiwan, Vietnam, S Korea that simply purchase components from China and resell them to the US The reality in high-tariff economies is simpler: more people just forge customs paperwork.

mystified5016 1y ago

Aliexpress has been routing packages through Africa and other places to dodge tariffs