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Apple CEO Says He Told Trump Tariffs Are Wrong Approach to China

Apple Inc. Chief Executive Officer Tim Cook said he criticized Donald Trump’s approach to trade with China in a recent White House meeting, while urging the president to address the legal status of immigrants known as Dreamers.

In an interview on Bloomberg Television, Cook said his message to Trump focused on the importance of trade and how cooperation between two countries can boost the economy more than nations acting alone.
 
Cook met with Trump in the Oval Office in late April amid a brewing trade war between the U.S. and China. The Trump administration instituted 25 percent tariffs on at least $50 billion worth of products from China, sparking retaliation. In the interview on “The David Rubenstein Show: Peer-to-Peer Conversations,” Cook acknowledged that previous trade policies were flawed but said Trump’s move is also problematic.
 
“It’s true, undoubtedly true, that not everyone has been advantaged from that — in either country — and we’ve got to work on that,” Cook said. “But I felt that tariffs were not the right approach there, and I showed him some more analytical kinds of things to demonstrate why.”
 
Although Apple produces most of its products in China and lists the U.S. and China among its three largest markets, the Cupertino, California-based technology company hasn’t been seriously affected by trade tensions so far. While products like the iPhone and iPad are designed in the U.S., they are made using China-based factories run by the likes of Hon Hai Precision Industry Co. and Pegatron Corp.

Apple generated $35 billion in revenue from the Americas in the most recent holiday quarter, while sales in China reached almost $18 billion. China has become one of Apple’s most important markets since Cook became CEO in 2011, and the company now has 41 retail stores in the region, the most outside of the U.S.

Closer to home, Cook said he asked the president to find a resolution for undocumented immigrants who were brought to the U.S. as children. Lawmakers have so far failed to negotiate a legislative replacement for the Obama-era Deferred Action for Childhood Arrivals program that spared Dreamers from deportation. “We’re only one ruling away from a catastrophic case there,” Cook said.

Apple has been more supportive of a Trump-backed law that slashed corporate taxes. It’s especially beneficial for Apple and other large U.S. technology companies that have hundreds of billions of dollars held overseas and are now bringing that money back. Cook said Apple will inject $350 billion into the U.S. over the next five years, through tax payments, hiring, a new campus and $30 billion in capital expenditure.

“We’re also going to buy some of our stock because we view our stock as a good value,” Cook told Rubenstein in the interview. “It’s good for the economy as well because if people sell stock they pay taxes on their gains.”

Cook also touched on Apple’s fast-growing services business, saying the Apple Music streaming service now has more than 50 million users on either paid subscriptions or free trials. Last month, the company passed 40 million subscribers, with 8 million trying the service out through free trials. Apple still lags Spotify Technology SA, which said this month that it has 75 million paying customers.

Rubenstein co-founded Carlyle Group LP, a private-equity firm that invested in the Beats consumer-electronics and streaming businesses. Apple acquired the venture in 2014 and turned the streaming operation into Apple Music, while keeping the Beats device brand.

Cook indicated that Apple will make a stronger push into streaming video and original TV shows and movies but declined to provide specifics. “We are very interested in the content business. We will be playing in a way that is consistent with our brand,” Cook said. “We’re not ready to give any details on it yet. But it’s clearly an area of interest.”

resource:https://www.bloomberg.com/news/articles/2018-05-15/apple-ceo-says-he-told-trump-tariffs-are-wrong-approach-to-china

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