Trump announced tariffs on components used in panel and chip production

August 7, 06:48

This measure was included in an executive order published by the White House, based on an investigation by the Department of Commerce under Section 232 of the Trade Expansion Act of 1962. The document concludes that the import of polysilicon and its derivatives 'threatens to harm U.S. national security' and mandates the introduction of restrictions to support domestic production.

The new restrictions, covering polysilicon, ingots, silicon wafers, solar cells, and photovoltaic modules, take effect on December 4. The order requires the Department of Commerce and the Department of Homeland Security to monitor the application of these measures and assess the need for further adjustments to protect American industry.

Although China is not explicitly mentioned in this order, the decision comes against the backdrop of the Asian country dominating global polysilicon production and a significant part of the solar panel supply chain. Despite the announced restrictions, major Chinese solar equipment and material producers reacted with a sharp rise in Shanghai and Hong Kong stock markets.

Polysilicon producers such as Xinte Energy (+9.4%), Tongwei (+6.74%), and GCL (+6.72%) led the rise, followed by major photovoltaic component manufacturers, including Xinyi Solar (+6.47%), Jinko Solar (+2.53%), and Longi Green Energy (+2.2%). Investor calm reflects the companies' stance, which considers the impact of the measures insignificant. Independent sources at Trina Solar told the news agency EFE that polysilicon constitutes only one element of their production chain, and direct sales to the American market are residual and often conducted through third parties.

In parallel, industry giants such as Longi Green Energy are restructuring operations in the U.S. and adjusting supply chains to comply with local requirements, aiming to circumvent trade tensions, as well as the problem of overproduction and fierce competition in the domestic Chinese market.

The U.S. government recently reported the reimbursement of $100 billion ($86.816 billion euros) in tariffs collected under the International Emergency Economic Powers Act (IEEPA), which were deemed illegal by the Supreme Court. The customs surcharges were announced by President Donald Trump in April 2025 under the name 'Day of Liberation,' but in February of this year, the country's highest court ruled them illegal, determining that the White House exceeded its authority by citing IEEPA to impose tariffs. Since then, the Trump Administration has sought alternative ways to continue using punitive customs duties in foreign relations and, in response to the Supreme Court's ruling, introduced a global 10% tariff, effective temporarily for 150 days. After this period expired, at the end of July, the U.S. government announced the imposition of additional tariffs on 60 trading partners, justifying it as punishment for countries that have not banned the import of products manufactured through forced labor.

podrobno.uzJuly 24, 10:50

US Imposes New Import Tariffs on Goods from Over 80 Countries

The administration of U.S. President Donald Trump approved the introduction of new import tariffs ranging from 10% to 12.5% on products from over 80 countries. These measures cover goods that constitute 99.4% of all American imports. The new tariffs took effect on Friday, July 24, replacing the previously active temporary 10% levy, which was introduced following a U.S. Supreme Court decision in February to overturn old levies.

Basis for Imposing Tariffs

According to information provided by the administration, this decision was made because, in the view of Washington, foreign states are not working actively enough to prevent the production and export of goods made using forced labor.

Tariff Differences and Exemptions

A base rate of 10% will be applied to countries that have confirmed compliance with the established requirements. Such countries include members of the European Union, Canada, Mexico, India, and the United Kingdom. For the remaining 38 countries, including China, Japan, Australia, and Brazil, a higher tariff of 12.5% has been set. Furthermore, categories of goods such as oil, gas, fertilizers, certain foodstuffs, critical minerals, aviation equipment, and products regulated by the USMCA free trade agreement between the U.S., Mexico, and Canada are exempt from these new tariffs. The measures also do not apply to cargo already subject to industry tariffs on metals and automobiles. A preferential transition period until July 28 is provided for goods currently in transit.

Global Community Reaction

The new tariffs provoked a negative reaction from several international partners. Authorities in Brazil, Australia, Japan, and Norway stated that the imposed tariffs are unjustified. Brazil publicly expressed its intention to take retaliatory measures, while China's Ministry of Foreign Affairs rejected the accusations leveled against it regarding labor rights violations.

Economic and Legal Consequences

Industry lawyers suggest that the new tariffs may become the subject of lawsuits, as there is a risk of charges of exceeding authority by the administration. According to forecasts from the New York Federal Reserve Bank, up to 90% of the costs associated with these tariffs will ultimately fall on American consumers and businesses. Additionally, the U.S. Trade Representative (USTR) continues to investigate sixteen countries regarding the issue of excess production capacity.

Additional U.S. Measures

It should be noted that starting August 19, the U.S. plans to introduce additional 50% tariffs on certain goods from Canada, including lumber, paper, alcoholic beverages, and hockey equipment. This decision by Washington was made in response to restrictions imposed by Canadian provinces on American alcohol.

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