Analysis Says Revoking PNTR for China Would Hurt US Manufacturing, Ag
Economists at the Peterson Institute for International Economics said that if the U.S. were to move all Chinese imports into Column 2 of the tariff schedule, removing permanent normal trade relations status, it would increase inflation by four-tenths of a percent if China were to retaliate, and it would hurt manufacturing the most -- the area politicians most want to protect.
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The analysis, released Sept. 17, says manufacturing would be hurt because factories are so reliant on Chinese inputs. The top U.S. imports from China are machinery, light manufactured goods, furniture and textiles, the report said -- and Chinese exports to the U.S. have more than quadrupled in the last 23 years, while overall imports have only doubled.
Agriculture also would be hurt, both due to retaliation and due to a stronger dollar that would result from the policy, the analysis projected.
Overall, the analysis projects a hit to U.S. GDP of .2%; from 2025 to 2028, durable goods manufacturing would decline by half a trillion dollars.