Trade Associations to Petition Trump Administration to Halt China-Tariff Plans
March 18 2018 - 7:04PM
Dow Jones News
By Bob Davis
WASHINGTON -- Forty-five trade associations, representing a wide
swath of the U.S. economy, are petitioning the Trump administration
to halt plans to levy tariffs on China and to work instead with
other nations to press Beijing to end restrictions on foreign
firms.
Imposing heavy tariffs, said a letter by the trade groups,
"would trigger a chain reaction of negative consequences for the
U.S. economy, provoking retaliation; stifling U.S. agriculture,
goods, and services exports; and raising costs for businesses and
consumers."
The White House is putting together a package of measures,
including tariffs on at least an annual $30 billion of Chinese
imports, to pressure Beijing to end requirements that U.S.
companies transfer technology to Chinese firms, The Wall Street
Journal has reported.
A decision may come this week or the next. While it may be too
late for the group to fend off tariffs, it hopes at least to slow
down the process. The group wants U.S. industries affected by any
tariffs to be able review proposed levies and make comments before
they go into effect.
"We request that the administration allow industry experts the
opportunity to comment on these issues, including the economic
impact of any potential actions," said the letter, which is dated
Monday.
The group includes trade associations covering the technology,
retail, agricultural and consumer-goods industries. It includes
household names such as Apple Inc., Alphabet Inc.'s Google, IBM,
Nike Inc. and Walmart Inc.
"We focused on tariffs because we know they don't work," said
Dean Garfield, the chief executive of the Information Technology
Industry Council, which organized the letter.
The group's preferred way of dealing with Beijing is to "work
with like-minded partners to address common concerns with China's
trade and investment policies," the letter said. "Imposition of
unilateral tariffs by the administration would only serve to split
the United States from its allies."
Mr. Garfield said international pressure sometimes prompts China
to roll back actions that discriminate against foreigners. U.S.
technology firms, from Intel Corp. to Apple, depend on China
operations for a big chunk of their profits earned by working in
China and selling there.
The administration has said that change in China happens too
slowly, resulting in a $375 billion U.S. merchandise trade deficit
with China. Many in U.S. industry agree with the administration
that Beijing uses its enormous market to force companies to
improperly transfer technology and submit to other discriminatory
practices. But they want the administration to take a less
confrontational approach.
The administration is also considering bringing a case before
the World Trade Organization alleging that China is violating trade
rules, which would be a way to try to build a coalition of nations.
But it is unclear whether that will proceed; a case would be
overshadowed by any move to levy tariffs before getting WTO
approval.
Countries bring cases to the WTO in Geneva for adjudication. If
a country wins a claim, it is authorized to assess tariffs, unless
the losing nation changes its offending practices.
Such actions take years to complete, and the Trump
administration is looking for faster action.
The move against China comes on the heels of a White House
decision to assess tariffs of 25% on steel products and 10% on
aluminum, citing national-security concerns. Industry groups also
had urged the administration to take a multilateral approach in
that case and to form a coalition to press China to cut its excess
metals capacity, which is widely seen as the source of a global
glut. Instead, the U.S. chose tariffs.
Mr. Garfield, though, said he saw hopeful signs in the way the
administration handled the metal cases. Initially, the
administration said it would apply tariffs across the board to all
nations. Now it has carved out exceptions for Mexico and Canada and
is considering them for other nations. It also has set up a formal
process for companies to win exclusions for their products.
The group wants the administration to set up a similar process
before assessing any tariffs, as a way to guard against potential
economic harm. Tariffs on information and communications technology
products would lower overall U.S. productivity growth, said a
report on Friday by the Information Technology and Innovation
Foundation, a research group in Washington, D.C., that takes a hard
line on China.
"Let's create a process where the administration shares their
thinking and allows people to comment," Mr. Garfield said.
Write to Bob Davis at bob.davis@wsj.com
(END) Dow Jones Newswires
March 18, 2018 18:49 ET (22:49 GMT)
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