Two high tech giants, Foxconn and Apple, are considering a deal to build a panel factory in the United States at a cost of about $7 billion and could create between 30,000 and 50,000 jobs. Chairman Terry Gou of Foxconn said that an investment by Foxconn’s Sharp division will depend on the terms negotiated for the deal at the state and federal levels.
The announcement of the deal comes close on the heels of President Donald Trump’s inaugural address in which the new president promised to make “America First” as the backbone of his policies leading the nation. Trump stated in his speech: “We will follow two simple rules: buy American and hire American.”
One of Trump’s campaign promises was to try and persuade Apple to bring the manufacture of iPhones to US shores. Trump said that he was optimistic that Tim Cook, CEO of Apple, had his “eyes open” to the possibility. Foxconn is the biggest producer of iPhones.
Gou said that Trump-style protectionism was inevitable, but he is unsure how Americans will feel about spending hundreds of dollars more for a phone that does not work any better than a less expensive model that was made overseas.
Gou vowed to increase his investments in China. Apple is also dependent on China, not just for production, but also for sales. Last year China made up 22 percent of Apple’s total revenue, some $46.4 billion.
In the wake of the meeting between US President-elect Donald Trump and Alibaba Executive Chairman Jack Ma, an Alibaba spokesman announced the company’s plan to incorporate and additional one million small US businesses onto its e-commerce platform.
The Chinese-based internet company, Alibaba Group Holding Ltd, predicts that the plan, to be implemented over the next five years, will create about one million new US jobs as each business adds at least one employee. This is not the first-time Alibaba has suggested to bring more small US businesses into their enormous marketplace, but it is the first time specific target numbers have been suggested.
The meeting between the leaders took place at Trump Tower in New York, where the president-elect lives. Trump said the meeting was “great” and added that they would do “great things” together. Ma said Trump was “smart” and “open-minded.”
Ma said the focus of the meeting was to discuss the best ways to support small businesses, especially in Midwest America. The idea would be to introduce the products from farmers and small clothing-manufacturers to the vast Chinese market directly through Alibaba.
Alibaba has been aggressively pursuing foreign brands to set up Tsmall stores, their online platform which offers virtual store fronts and payment portals to merchants. His goal is to simplify the sales, payment and shipping process for the vast and growing Chinese shopper which Ma is relentlessly attracting to his e-commerce website.
Right now, there are about 7,000 US brands sitting on Alibaba’s Tmall, including US giants such as wholesaler Costco Wholesale Corp and clothing manufacturer Levi’s. Last year these companies made $15 billion in sales to Chinese consumers, although some foreign retailers say they have had a mixed success on Tmall.
Last month the US Trade Representative put Alibaba back on to an infamous list of blacklisted online retailers due to suspicions that the company does not do enough to end counterfeiting on their site.
Russian President Vladimir Putin seemed to once again do the unexpected when he announced that he was not going to retaliate in response to President Obama’s move to expel 35 Russian diplomats from the United States. It seemed he only had to wait a mere three weeks or so for the bruhaha to die down when Donald Trump is sworn in as the next US president.
Now, however, there are reports that Russia is taking some steps to punish the US for its actions. Last week CNN reported that Russian authorities ordered the closing of the Anglo-American School in Moscow, siting an unnamed source who said he knew personally about the development. The school is for the children of Western embassy personnel from Britain, Canada and the USA.
The Russian foreign ministry denied the allegation.
CNN also reported that Russia ordered the closing of a vacation home used by US embassy personnel, about 16 kilometers west of Moscow.
In contradiction to earlier reports that there would be no reprisal against US diplomats in Russia, Russian spokeswoman for the Ministry of Foreign Affairs, Maria Zakharova said that a Russian response to Obama’s actions would be similar which would “immediately backfire at US diplomats in Russia.”
“The outgoing US administration has not given up on its hope of dealing one last blow to relations with Russia, which it has already destroyed,” her statement said.
The Kremlin had previously stated that the US would “receive an answer” if it did anything to punish Russia. Obama sought to impose sanctions on Russia for its role in tampering with the recent US elections via hacking of email accounts associated with people in the Democratic Party. Several US intelligence agencies have stated the Russian actions were deliberately designed to interfere with the US elections, specifically, to help Donald Trump with the election.
Until the election of Donald Trump to become the US president beginning in early 2017, US business schools were a desirable option for students from overseas looking to earn an MBA. Now some of these prospective students are reconsidering US business schools as an option.
“I want to be able to work in the country where I study after graduation,” one marketing executive from India said. “So it is important to be in a place that is immigrant-friendly.”
US business school deans are hopeful that this prospective student is not the sign of a trend.
Douglas Skinner, dean of the University of Chicago’s Booth School of Business says he is “cautiously optimistic,” about the backlash from a Trump presidency. He pointed out that even if the economy was to stall, (something he does not think will happen,) domestic demand for MBA places would rise, since that is the trend when jobs are more scarce.
But Skinner is afraid that the threatened proposals to immigration will seriously effect enrollment in his school’s MBA program. More than one-third of the full-time students attending the Chicago Booth School of Business come from overseas.
“If there was a restriction on visas to students that would clearly be somewhat harmful to us,” Prof Skinner says. He adds that other schools are even more dependent on students from abroad than Booth is.
A survey conducted by the National Association for Business Economics showed that Hillary Clinton is the preferred candidate for president of the US by 55 percent to an embarrassing 14 percent for Donald Trump. As a matter of fact, Trump was not the second choice. Third party Libertarian candidate Gary Johnson had more support than Trump, with 15 percent saying they would prefer to see him as president. An additional 15 percent said they did not know or had no opinion.
The survey was conducted from July 20 to August 2 and included the views of 414 members of NABE.
Some of Trump’s policies seem to be contributing to his lack of support. Whereas Trump says he would like to nullify or severely restrict the North American Free Trade Agreement, 65 percent of business economists say US trade policy should be even more open and free versus only 9 percent who agree with Trump that trade should be more protectionist.
Trump has expressed a desire to deport illegal immigrants, but the NABE survey showed that only 8 percent agreed with that sentiment, while 64 percent said they would like to see a program to legalize undocumented immigrants who already live in the US.