summary: us economists believe that imposing tariffs on china will have multiple adverse consequences
2024-09-16
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xinhua news agency, washington, september 15 summary | us economists believe that imposing tariffs on china will have multiple adverse consequences
xinhua news agency reporter xiong maoling
amid opposition from all sides, the office of the united states trade representative issued a final decision on the imposition of section 301 tariffs on china on the 13th, and the relevant measures will take effect on september 27. many american economists said that the united states abused the "section 301" and imposed additional tariffs on chinese electric vehicles and other new energy products, which actually served the domestic politics of the united states, pushed up the prices of imported goods in the united states, hurt the interests of american consumers and enterprises, dragged down the us economy, hindered the united states' efforts to combat climate change, and undermined the international trade order and the security and stability of the global industrial chain and supply chain.
on may 14, the united states released the results of the four-year review of the 301 tariffs imposed on china, announcing that on the basis of the original tariffs, it plans to further increase import tariffs on chinese-made electric vehicles, lithium batteries, photovoltaic cells, key minerals, semiconductors, as well as steel and aluminum, port cranes, personal protective equipment and other products.
the ustr issued a final decision on september 13 and published a notice of revised information in the federal register. most of the content announced in may this year was adopted.
this is the exterior view of the office of the united states trade representative taken in washington, the united states on september 13. photo by xinhua news agency reporter hu yousong
economists pointed out that although the inflation pressure in the united states has eased recently, the inflation rate in the united states is expected to remain higher than the target of 2% this year. imposing tariffs on china may push up inflation again, and most of the cost will still be borne by american consumers and businesses.
the study found that since 2018, the united states has significantly increased tariffs on some chinese goods, and american import agents, wholesalers and retailers have borne more than 90% of the cost of the increased tariffs. they have passed the pressure on to downstream producers and end consumers in the form of "price increases", which has fueled high inflation in the united states.
"biden's trade policy limits americans' opportunities to enjoy high-quality, low-cost foreign products." gary hufbauer, a senior fellow at the peterson institute for international economics, a u.s. think tank, told xinhua news agency that the new u.s. tariff measures will deprive american consumers of the right to purchase cost-effective chinese electric vehicles.
hufbauer believes that if trump is elected president and fulfills his campaign promises on trade, the u.s. consumer price index could rise sharply by 2 to 3 percentage points. "this will be very painful for consumers, but it will be difficult for u.s. manufacturers to benefit significantly because they themselves do not produce a large amount of the goods subject to tariffs."
as the additional tariffs will push up the prices of parts and raw materials, some american companies will face the dilemma of increased production costs and reduced product competitiveness. peter moroch, professor emeritus at the university of maryland school of business, believes that some american manufacturers will be at a clear disadvantage in the us and global markets.
although the u.s. government claims that the tariff increase is to protect domestic companies and workers, the facts of the past few years have shown that the tariff increase has not increased employment in related industries in the u.s. at the same time, as trading partners have imposed retaliatory tariffs on u.s. products, their overseas sales costs have increased, and employment in sectors such as agriculture in the u.s. has been negatively affected.
a report released by the u.s.-china business council and the oxford economics institute in november last year showed that terminating permanent normal trade relations with china would cause the united states $1.6 trillion in economic losses over five years and cost the united states more than 700,000 jobs.
customers shop at a supermarket in millbrae, california, the united states on february 13. xinhua news agency (photo by li jianguo)
considering the negative impact of tariffs on consumption, exports, and employment, the us economic growth is bound to be dragged down. recently, the us job market has become increasingly sluggish, manufacturing activities have continued to slow, housing sales have been weak, and the downturn has spread to many areas. fitch ratings predicts that a substantial increase in us tariffs could reduce us and global economic output, and the us economy could immediately shrink by 0.8%. if other countries take retaliatory measures, the situation will deteriorate further.
in the long run, high tariffs will weaken the competitiveness of the u.s. high-tech industry and affect the process of energy transformation in the u.s. william reinsch, a senior adviser to the center for strategic and international studies, a u.s. think tank, warned in an article that the u.s. relies on china for important green transformation products such as photovoltaic cells and key minerals. imposing tariffs will increase the cost of these products and slow down the pace of the u.s. in achieving its climate goals.
the abuse of trade barriers by the united states will also undermine the global trade division system based on comparative advantage and affect the sustainable development of the global economy. the international monetary fund previously released a report pointing out that the united states continues to escalate trade restrictions, posing a growing downside risk to the u.s. and global economy. tariffs and non-tariff barriers and other means of distorting trade and investment may damage the multilateral trading system and disrupt the global supply chain.
jeffrey sachs, director of the center for sustainable development at columbia university in the united states, told xinhua news agency that the world should be wary of falling into a vicious cycle of protectionism. the united states is deviating from its international responsibilities and violating international economic and trade rules. china and other countries should firmly defend the international trade system and maintain the openness of global trade.
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