• Donald Trump’s unilateral tariffs crashed stock markets across the world on Thursday and could make iPhone devices very expensive.
• With an over 50 percent trade tariff imposed on China, Apple’s investors routed.
• Analysts now believe Apple will be forced to increase its prices significantly to counter-attack the effects from the tariffs.

Sweeping trade tariffs that came into effect this week from the administration of US President Donald Trump obliterated the global markets, including South Africa’s JSE and are stoking fears of a looming global recession.

US stock market indices like the NASDAQ, S&P 500 and the Dow Jones crashed to lows the trading world hasn’t seen since the onset of the COVID-19 pandemic. The tech industry also saw stocks collapse, including Apple, an international tech powerhouse that counts on a number of countries for its enormous supply chain management in the production of its devices, including mac PCs and the iPhone.

As Trump’s tariffs put these international agreements of Apple’s at risk, investors panicked and the stock was affected.

Particularly of note to Apple, is Trump’s 54 percent tariff on China. Since the vast majority of iPhone devices are made in China, Apple will have to make the difficult choice to either absorb these costs or pass them on to customers.

If the costs are passed on, Apple could start charging $2 300 for its top-of-the-range devices, or more than R42 000. The cheapest non-e version of the iPhone 16 launched at $799 (~R15 200) but analysts now believe that tariffs on China could see this price balloon to $1 142 (~R21 738).

Apple devices are already marked up from the base US prices in South Africa. For example, instead of R15 000 for the normal iPhone 16, South Africans are charged R20 000. While it is currently only foreseen that Apple prices will increase in the US, reciprocal tariffs from South Africa to the US could make all imported products considerably more expensive.

“The Presidency has noted with concern the newly imposed tariffs on South African exports to the United States of America,” it said in a statement on Thursday.

“Unilaterally imposed and punitive tariffs are a concern and serve as a barrier to trade and shared prosperity.”

Indeed, Apple will likely have to balance out its prices internationally to offset increases brought on by the Trump’s tariffs, and perhaps future negative effects from international trade wars and a global recession, which is now believed sitting at a 60 percent likelihood, according to JP Morgan.

As for Trump, he is bent on using the tariffs as a bargaining chip to strong-arm other countries, and it is likely that they will continue to be implemented, seemingly without worry of consequences like a recession.

“The tariffs give us great power to negotiate. Always have. I used it very well in the first administration, as you saw, but now we’re taking it to a whole new level,” the US President said, per Reuters.