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Apple's future in China looks bleak

Apple’s (AAPL) road ahead in China will likely continue to be turbulent even if there is a U.S. trade deal with China.

“We have to remember the Chinese government has been trying to undermine Apple’s business for at least since March of 2013. There are periodic campaigns against Apple. And of course they help Huawei,” Gordon Chang, China expert and author of “The Coming Collapse,” told Yahoo Finance On the Move.

“So eventually, Apple has a declining future in China. Part of it is also because it’s wrongly placed in the market, there are a lot of cheap products in the market as good as Apple,” added Chang.

The real question investors need to ask is if things could get any worse for Apple in the world’s second largest economy. Apple continues to be hampered by a barrage of cheaper priced smartphones in the country and the view among the Chinese that its products are too expensive.

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Many experts say Apple’s sales in China have also been hit because its brand is so synonymous with the United States.

Apple’s sales in China in the most recent quarter plunged to $13.2 billion from $17.9 billion a year ago. The tech giant saw sales decline across its iPhone, Mac and iPad businesses. Apple CEO Tim Cook pinned the blame on a slowing Chinese economy derailing upgrades to new higher priced hardware.

Early data on the current quarters suggest Apple’s struggles in China haven’t abated despite a slowly rebounding Chinese economy.

“Analysis of monthly government smartphone sell-through data from China suggests the annual rate of decline for Apple iPhones in the month of February (down 67% year-over-year) is similar to the weakness in January and December months (down 68% in each month),” wrote UBS analyst Tim Arcuri in a mid-March note to clients.

“Overall, the data is neutral as weak China smartphone is well understood as are iPhone struggles in China,” added Arcuri.

An Apple spokesman didn’t return a request for comment.

Brian Sozzi is an editor-at-large at Yahoo Finance. Follow him on Twitter @BrianSozzi

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