Daily Management Review

Foxconn: There's a technological war between the US and China


06/22/2018


Taiwanese company Foxconn, the world's largest contract manufacturer of electronics, said that the US and China are a technological, rather than trade war, reports Reuters.



"The biggest problem we face is the "trade war" between the US and China. As for how we manage and adapt, all our top managers are making different plans," said Foxconn chairman of the board Terry Gou at the annual general meeting.

He did not specify what kind of plans are being considered.

"Their war (the US and China) is not really a "trade war", it's a technological war. A technological war is also a production war," Gou said.

Foxconn is officially known as Hon Hai Precision Industry Co Ltd. The company employs more than 1 million employees, among its customers is Apple Inc.

On Monday, US President Donald Trump said that he instructed the US trade representative to prepare a list of Chinese goods worth $ 200 billion, in respect of which additional duties of 10% may be imposed.

This happened after the State Council of China approved introduction of an additional duty of 25% on 659 names of American goods worth about $ 50 billion.

In turn, Beijing's actions were a response to the introduction of US duties at a rate of 25% on imported products from China for $ 50 billion.

The US accused China of stealing US intellectual property. Beijing denies this accusation.

Analysts warn that the "trade war" between the two largest economies in the world can disrupt the supply chain for the technological and automotive industries. These sectors largely depend on components supplied by third-party manufacturers, such as Foxconn.

The US and China are the largest export markets of Taiwan.

Gou noted that it is necessary to remember the uncertainty about inflation and the interest rate increases, and that the Chinese economy is still affected by "structural adjustments." 

source: reuters.com






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