Trade Group Asks Congress to Keep China PNTR Status

According to a recently released study by the Peterson Institute for International Economics, American engagement in the world economy has likely added 11 percent to the U.S. Gross Domestic Product.  Researchers with the independent nonprofit, nonpartisan organization say U.S. GDP would have been nearly $2 trillion below the $25.5 trillion mark recorded in 2022 without the country participating in global trade. The report also shows inflation between 2016 and 2022 as the main driver of the higher payoff. 

The white paper does show that trade barriers have contributed to an overall slowdown in trade as globalization has tapped the brakes. Over the past decade, countries like China have experienced a declining ratio of two-way trade to GDP, while the US ratio has been flat.

The report claims that more than 310,000 manufacturing jobs were “adversely affected” by increased imports of manufactured goods. Two-thirds of those jobs were in the manufacturing sector with the rest mainly in support services though agriculture and mining were also affected.

Other downsides in the data included an estimated 2.4 million domestic workers who lost their jobs due to Chinese imports between 2000 and 2011. Peterson Institute researchers say this is a small number when compared to a U.S. workforce of over 50 million. 

U.S. trade with China continues to suffer ups and downs. Earlier this week, a conflict over new phones produced by Chinese telecom giant Huawei Technologies brought strong language from both sides of the Pacific. Commerce Secretary Gina Raimondo warned of the “strongest possible” action to defend national security. The Chinese Foreign Ministry responded in kind.

Mao Ning, Chinese Foreign Ministry spokesperson: “The U.S. has repeatedly said that it has no intention of decoupling from China or obstructing China's economic development. It should put these commitments into practice. China will follow closely the developments of the situation and resolutely safeguard its legitimate rights and interests.”

China’s Permanent Normal Trade Relations status or PNTR has come under federal scrutiny. Various farm advocacy groups are concerned the U.S. Select Committee on the Chinese Communist Party might recommend revoking China's PNTR.     

In a letter sent this week by Farmers for Free Trade, a case was made for keeping China’s PNTR status. They believe removal of the status that smooths out bumps in the trade policy road will have a profound economic effect on American farmers, ranchers and food producers that would be felt for years. The letter goes on to state that China is the largest buyer of U.S. food and agricultural products and continued purchase of these products by China is critical to America’s farmers and rural communities.        

Among the groups also signing the letter were the American Soybean Association, the National Corn Growers and the Meat Institute.

For Market to Market, I’m David Miller.