TikTok will not go dark in the United States for at least another 75 days, after President Donald Trump said he would extend the deadline requiring a ban on the app if its Chinese owner does not sell its US assets.
Time ran out on the deadline over the weekend, even as a preliminary deal on the sale of TikTok’s US assets was reportedly reached last week.
That deal was ultimately turned down by China, however, in retaliation for Trump’s tariff war.
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“We had a deal pretty much for TikTok – not a deal but pretty close – and then China changed the deal because of tariffs,” Trump told reporters on Sunday, according to a report by Radio Free Asia.
“If I gave a little cut in tariffs they would have approved that deal in 15 minutes, which shows the power of tariffs.”
For now, the power of tariffs has driven global equities off a cliff, erasing $6.6 trillion in market value in US stocks alone last week. The bearish sentiment has engulfed Asia too, with a region-wide ‘bloodbath’ seen on Monday.
China, meanwhile, has maintained an aggressive stance against Trump’s tariffs, imposing high retaliatory levies and blanket curbs on export of critical minerals necessary for defence and clean technologies.
Its refusal to approve the TikTok deal is along those lines too.
According to a Washington Post report, the Trump Administration was “hours away” last week from announcing its proposed deal on a spinoff of TikTok’s US assets. TikTok’s Chinese parent ByteDance had also agreed to the proposed deal, the report said, citing people close to the negotiations.
But Trump’s announcement of so-called “reciprocal” taxes as high as 34% on Chinese goods shut it down.
ByteDance eventually informed the White House that Beijing would not “approve of any deal without first discussing President Donald Trump’s tariffs and trade policy,” WaPo reported.
‘Differences remain’
Amidst reports of its preliminary approval of the deal, ByteDance also said on Sunday that differences still remained over the deal.
“(We are) still in talks with the US government, but no agreement has been reached, and the two sides still have differences on many key issues,” the company said in a statement on its official account on Chinese social media platform WeChat.
“In accordance with Chinese law, any agreement is subject to the relevant review procedures,” it said.
If the previously planned deal had gone through it would have given ByteDance a less than 20% share in the spinoff. The new company was slated to be majority-owned and operated by US investors.
The Chinese Embassy in Washington, asked about the status of a deal for TikTok, said in a statement to Reuters: “China has stated its position on TikTok on multiple occasions. China has always respected and protected the legitimate rights and interests of enterprises and opposed practices that violate the basic principles of the market economy.”
Meanwhile, on Friday, as he announced an extension of the divest-or-ban deadline, Trump proclaimed he did not want TikTok to go dark. “We hope to continue working in good faith with China,” he added.
In keeping with Trump’s vow, the US Attorney General sent a letter of assurance to iPhone-maker Apple that it would not be penalised for hosting TikTok on its App Store. The AG directed Apple to “act in accordance with Trump’s deadline extension,” CNBC reported.
- Vishakha Saxena, with Reuters
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