U.S. President Donald Trump took to Twitter Tuesday to warn China to ink a new trade deal now or be stuck with a "much tougher" agreement in the future.
Trump wrote in the first of multiple Tweets the Chinese economy is "doing very badly" after economic data showed the slowest growth in nearly three decades. Meanwhile, China's pledge to start buying American agricultural products is showing no signs of progress, which he said is typical for the country as "they just don't come through."
Trump said his trade negotiation team is working with their Chinese counterparts and acknowledged it would be wise for China to hold off until the 2020 presidential election. The Chinese government is likely hoping "one of the Democrat stiffs like Sleepy Joe [Joe Biden]" would be willing to cave in and sign a trade deal that is a "ripoff" for America.
The problem with hoping for a Democrat win in 2020 is that if Trump emerges victorious the trade deal will be more harsh -- if it's even offered in the first place.
...to ripoff the USA, even bigger and better than ever before. The problem with them waiting, however, is that if & when I win, the deal that they get will be much tougher than what we are negotiating now...or no deal at all. We have all the cards, our past leaders never got it!
— Donald J. Trump (@realDonaldTrump) July 30, 2019
Huawei Not Feeling The Heat
China's telecom giant Huawei showed in its earnings report for the first half of 2019 a 23.2% year-over-year increase in revenue to 401.3 billion yuan ($58.26 billion), CNBC reported. The company described its operations as being both "smooth" and "as sound as ever."
Huawei said it secured 50 commercial 5G contracts with carriers across the world and its core networking equipment business showed 146.5 billion yuan in sales.
How Apple Fits In
Data from Canalys point to Huawei's smartphone shipments in China jumped 31% year-over-year in the second quarter while Apple Inc. (NASDAQ: AAPL)'s shipments fell 14% over the same time period, according to CNBC. The China-based company "kept its foot on the accelerator" in the local market through a "wave of marketing spend to support new channels and technologies," Canalys analyst Mo Jia wrote.
Apple is scheduled to report fiscal third-quarter results after Tuesday's close with much of the attention focused on China.
Eighteen months ago, two-thirds of iPhone sales were generated in China and this figure dipped to around 53% and Tuesday's report could show the figure falling below the 50% level, Cyrus Mewawalla of GlobalData told CNBC. Falling below the 50% barrier is "probably not good for Apple" and so long as the trade war remains unresolved Chinese sales for Apple will continue falling at the expense of Huawei and other local firms who will fill the void.
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