The iPhone is made in China but only about 1% of the price (US$6.54) goes there. The retail price is US$600 and more than 60% goes directly to Apple and other American companies.
A new research paper calculates that because of the way trade statistics are calculated – the full value of an iPhone is considered an export to the US from China by both countries – the iPhone alone added almost US$2 billion to America’s trade deficit with China in 2009, The Wall Street Journal reported.
The authors find that if a "value-added approach" had been used to calculate trade statistics, the iPhone would have instead generated a US$48 million trade surplus for the US in 2009, instead of the US$1.9 billion trade deficit reported using conventional methodology, Daily Markets reported.