TikTok’s Future Is Now Tied to Trump’s Tariff Threats on China
TikTok had the briefest of retirements this weekend. After going dark for approximately 12 hours on Jan. 19, it returned online following a pledge from President Donald Trump to halt a ban of the popular short-form video platform. Trump yesterday (Jan. 20) followed through on this promise by signing an executive order that gives the Chinese-owned app a reprieve of 75 days.
This timeframe will “allow my Administration an opportunity to determine the appropriate course forward in an orderly way that protects national security while avoiding an abrupt shutdown of a communications platform used by millions of Americans,” said the executive order. The President, who has suggested that the U.S. take on 50 percent ownership of TikTok, hinted that potential tariffs on China will be closely linked to whether such a joint venture is approved.
“If China didn’t approve it, we could put tariffs on China,” Trump said yesterday while speaking to reporters in the Oval Office. “I’m not saying I would, but you certainly could do that,” he added.
The U.S. imports around $400 billion worth of goods from China every year. While Trump has spent months repeatedly threatening tariffs of as high as 60 percent on Chinese imports, he held off from enacting any executive orders related to China tariffs during his first day in office. He also didn’t take action on proposed tariffs in Canada and Mexico, although he warned that a 25 percent levy on imports from the two nations could go into effect by Feb. 1.
What’s next for TikTok?
Owned by the Chinese company ByteDance, TikTok was launched in the U.S. eight years ago and boasts more than 170 million American users today. Amid national security concerns over the Chinese government’s access to sensitive user data on the app, a 2024 law from the Biden Administration that bans the app’s use in the U.S. unless TikTok is sold to a U.S. owner went into effect last week.
Trump, meanwhile, is proposing a deal that would see TikTok and the U.S. oversee joint ownership of the app. This would allow the U.S. to directly benefit from TikTok’s value, according to Trump, who estimated the app could be worth up to $1 trillion if a deal is reached. Without a deal, however, “it’s worthless,” according to the President. While Trump didn’t specify what entities would make up America’s 50 percent share, he remarked that “every rich person has called me about TikTok” when asked whether a private sector owner could be involved.
Rejecting the proposal would be a “hostile act” from China, added Trump, who said he believes the country will approve a deal to avoid potential tariffs from the U.S. that could stretch as high as “25, 30, 40, 50 percent—even 100 percent.” China’s Vice President Han Zheng attended Trump’s inauguration yesterday. So did TikTok CEO Shou Zi Chew, who is Singaorean.
When asked today about Trump’s proposed TikTok sale, China’s Foreign Ministry said “the operation and acquisition of businesses” should be “independently decided by companies in accordance with market principles” in compliance with Chinese law. “We hope the U.S will earnestly listen to the voice of reason and provide an open, fair, just and non-discriminatory business environment for market entities from all countries,” Guo Jiakun, the government agency’s spokesperson, told reporters.
While TikTok has already restored access in the U.S., the app has yet to return to app stores owned by Apple and Google. Given its tenuous future, users of the platform have flocked to alternative apps. Red Note, another China-owned video platform, has emerged as a surprisingly strong contender and earlier this month gained an additional 1.4 million U.S. iPhone users, according to analytics firm Similarweb. As of today, Red Note remains the most downloaded free app in Apple’s U.S. App Store.