“Apple Diversifies Supply Chain Amid US-China Economic Warfare: Invests $430 Billion in US Economy”

2023-05-24 05:55:00

Under economic warfare and bilateral sanctions between China and the United States, Apple is seeking to diversify its activities outside of China, on which it is very dependent for its supply chain. This Wednesday, the iPhone manufacturer announced that it would work with the American Broadcom, which will notably design and build components used to capture 5G, the fifth generation of mobile telephony.

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Production will take place at various US sites, including Broadcom’s plant in Fort Collins, Colorado.

Invest $430 billion in the US economy over five years

« All of Apple’s products depend on technologies developed and built here in the United States, and we will continue to invest in the American economy because we believe steadfastly in America’s future. “said Apple boss Tim Cook, quoted in a press release. The company says the announcement is part of Apple’s 2021 commitments to invest $430 billion in the US economy over five years, from suppliers to spending on IT servers.

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It is good for the apple brand to reduce its dependence on China. Strict policies to combat the Covid epidemic have slowed production and the current diplomatic tensions with the United States, which threatens to ban exports of high-tech components to the Middle Kingdom, have forced fate.

Eyes on India

Tim Cook had nevertheless assured that Apple enjoys a relationship ” symbiotic with China during a March visit to Beijing to attend a state-sponsored event with leading figures from the business sector. The word symbiosis had not been chosen at random. According to its definition, it designates a close association of two or more different organisms, mutually beneficial, even essential to their survival.

But the boss of the apple brand also went to India in the spring to inaugurate one of the brand’s first two stores in the most populous country in the world. Last September, the Californian group said it would manufacture its latest iPhone 14 in India, and Foxconn, the Taiwanese technology giant and main iPhone assembler, has just bought a huge piece of land in the suburbs of Bangalore, Silicon Valley Indian. ” Having alternatives or diversification makes it possible not to depend too much on a single region “, estimated then with AFP Prachir Singh, analyst of Counterpoint Technology Market Research. ” It’s not like Chinese operations are going to drop to zero “, he added, however, “ it is a question of building a similar environment in India in order to be able to count on several sites. The American giant has also just opened its first online store in Vietnam, thus continuing its conquest of emerging markets in Asia.

In March, Apple also announced that it planned to invest one billion euros over the next few years on its Munich site, dedicated to the development of electronic chips. This expansion into Germany is part of its strategy to increasingly develop the chips used in its smartphones, computers, tablets and other connected devices.

Germany ramps up announcements of mega-investments in semiconductor production

For its part, Berlin is doing its utmost to attract technology companies and in particular semiconductor producers. From electric cars to smartphones to wind turbines and even missiles, these microchips are the ” 21st century oil », components including « everything else depends “Launched Chancellor Olaf Scholz during the inauguration of a new factory of the German manufacturer Infineon in early May. Traveling last weekend to Seoul, it is still semiconductors that the leader spoke with his Korean interlocutors, calling on them to invest in Europe to strengthen supply chains. The stated objective of the EU is to reach 20% of the world market in 2030, i.e. twice as much as today: this will require quadrupling production on the Old Continent. This is the aim of the European “Chips Act” concluded in April, which plans to mobilize 43 billion euros in public and private investment. Europe’s leading economy wants to spearhead this movement to reduce dependence on Asia.

(With AFP)