US President Donald Trump loves his tariffs and it seems that not even a meeting with Nvidia CEO Jensen Huang could persuade him to change course.
"Eventually we're going to put tariffs on chips. We're going to put tariffs on oil and gas. That'll happen fairly soon. I think around the 18th of February," the President told the press amid another round of executive orders on Friday.
Trump made the remarks when asked about a meeting with Huang last week. Nvidia told us that during that session, Huang discussed the importance of strengthening US technology and AI leadership.
But apart from reaffirming his plans to place new import tariffs on foreign-made semiconductors, which he's previously said could be as high as 100 percent, the president didn't go into much detail about the chat. "I can't say what's going to happen. We had a meeting. It was a good meeting," he said of his catch-up with Huang.
Instead, Trump took the opportunity to praise the economic lever. Going back to his first term, tariffs have become a favorite bargaining chip for achieving Trump's geopolitical and economic agenda. Over the weekend, the US President announced a 25 percent tariff on imports from Canada and Mexico along with an additional 10 percent duty on imports from China, but following significant backlash and retaliatory tariffs on American imports by Canada and Mexico, the White House has opted for a 30-day-plus pause for the two US neighbors.
With Trump eyeing another round of taxes on chips and other goods, we can see why they might be a subject of interest for Huang. Nvidia's chips are primarily manufactured outside of its home nation of America, and therefore would be subject to the foreign semiconductor tariff; for one thing, Taiwan's TSMC makes Nv's graphics processors and AI accelerators. And because these import tariffs are paid by the importer, this has the potential to result in lower margins for the likes of Nvidia unless costs are passed on to buyers.
Asked about the impact of tariffs on inflation and consumers, Trump claimed "tariffs don't cause inflation, they cause success," and said "there could be some temporary short term disruption and people will understand that."
Short term or not, the impact of the tariffs is expected to drive up the cost of electronics in America. In fact, the proposed US tariffs on Canada already stirred tensions in the tech sector. In response, Ontario's government threatened to scrap its Starlink contract. With the 30-day-plus pause in place, though, Canada has paused its retaliatory measures, including the previously discussed possibility of restricting energy exports to the US.
However, tariffs aren't the only reason Huang might have for meeting with Trump.
Nvidia has found itself at the center of the US trade war with China. The most aggressive of these rules, implemented by the Biden administration just days before his term expired, established export caps on the sale of GPUs and other AI accelerators sold to most of the world.
The decision, which restricts Nvidia's ability to sell its wares outside a handful of allied nations, sparked outrage from the chip designer.
"In its last days in office, the Biden administration seeks to undermine America's leadership with a 200+ page regulatory morass, drafted in secret and without proper legislative review," VP of government affairs Ned Finkl said at the time. "The Biden administration's new rule threatens to squander America's hard-won technological advantage."
Considering the fact the task of implementing the export controls now falls on the Trump administration, we would imagine the subject probably came up. ®
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