In a nutshell: Chinese-owned TikTok faced a US ban on April 5 unless it could divest its American operations to a stateside buyer. The Trump administration was reportedly finalizing a deal involving several investors, but Beijing withdrew in response to new US-imposed tariffs, prompting the White House to extend the deadline.
President Trump recently signed an executive order to extend the delay on TikTok’s US ban for another few months as negotiations to sell the Chinese-owned social network to American investors continue. The President claimed that the deal had seen “tremendous progress,” but his recent sweeping “Liberation Day” tariffs reportedly pushed the Chinese government to stop the deal.
Sources told the AP and Reuters that TikTok owner ByteDance and the White House were finalizing an investment deal with multiple US companies that would leave ByteDance with a 20 percent stake. The identities of the American buyers remain undisclosed. However, previous reports mention private equity firm Blackstone, tech giant Oracle, Amazon, mobile app platform AppLovin, OnlyFans founder Tim Stokely, and others.
On April 2, Trump introduced historic tariffs on many countries. The lengthy list, which experts have described as a “nuclear bomb” on international trade, includes new taxes on imported Chinese goods that increase total anti-China tariffs to 54 percent. In response, Beijing signaled to ByteDance that it wouldn’t approve TikTok’s divestment until it could renegotiate the duties.
Congress passed a law banning TikTok in the US last year for national security reasons. However, President Trump, reversing the stance from his first term, extended the deadline days after taking office to allow time for a sale.
Many fear that the social network could put the personal data of its over 170 million American users into Beijing’s hands or make them vulnerable to Chinese propaganda. Still, support for a ban has subsided considerably over the past two years.
Trade groups expect the new US tariffs to disrupt the global economy, upending a trade paradigm that has lasted for decades. Virtually everything Americans buy, including computers and other electronics, could see substantial price hikes.
As markets have lost trillions of dollars over the past few days in the worst performance since the pandemic, tech companies such as AMD, Dell, and HP experienced almost 10-percent declines. Although semiconductors aren’t affected yet, new incoming tariffs might also target them.
