Report concludes hefty tariffs on China could cost US economy billions

Report concludes hefty tariffs on China could cost US economy billions
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Tariffs on China’s information and communications technology imports would lead to billions in losses for the U.S. economy, a new report released on Friday shows.

Any Trump administration plan that would levy a 25 percent tariff on those types of Chinese products would cost the U.S. economy $332 billion over the next 10 years, according to a new report released by the Information Technology and Innovation Foundation (ITIF), a technology policy trade group.

If those tariffs were set at 10 percent, the same as a recently announced tariff on aluminum imports, the damage would add up to about $163 billion in economic losses over the next decade, according to the report

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"The Trump administration’s goals of confronting unfair Chinese trade practices and reinvigorating U.S. manufacturing are commendable, but we need to ensure that any penalties on China’s trade actions are not penalties on the U.S. economy,” said ITIF Vice President Stephen Ezell, lead author of the report.

“[Information and communication technologies] products are critical capital goods that drive productivity growth in most U.S. goods and services industries,” Ezell said.

President TrumpDonald John TrumpGOP congressman slams Trump over report that U.S. bombed former anti-ISIS coalition headquarters US to restore 'targeted assistance' to Central American countries after migration deal Trump says lawmakers should censure Schiff MORE has reportedly asked U.S. Trade Representative Robert LighthizerRobert (Bob) Emmet LighthizerOn The Money: Economy adds 164K jobs in July | Trump signs two-year budget deal, but border showdown looms | US, EU strike deal on beef exports Chinese, US negotiators fine-tuning details of trade agreement: report The Trump economy keeps roaring ahead MORE to put together a plan that could target upward of $60 billion in Chinese products over intellectual property theft.

Peter Navarro, a White House trade adviser, told CNBC on Thursday that “in the coming weeks” recommendations under a Section 301 investigation will hit Trump’s desk over intellectual property protection concerns.

Trump’s recent decision to slap hefty 25 percent tariffs on imported steel and 10 percent tariffs on imported aluminum has generated concerns among business groups and lawmakers on Capitol Hill.

Ezell said that imposing tariffs on information and communications technology imports, which includes everything from computers and smartphones to routers and chips, would reduce investment and weigh on U.S. innovation, productivity and competitiveness.

“The Trump administration is right to undertake a comprehensive review of America’s trade relationship with China," Ezell said.

"China’s mercantilist policies toward innovation industries are the greatest trade threat to both America’s economy and the global trading system,” he said.

“But any steps to pressure China to finally live up to its [World Trade Organization] commitments must be steps that help, not hurt, the U.S. economy.”