Clinton argues China trade pact will benefit IT companies
- By William Matthews
- Jan 27, 2000
President Clinton is urging Congress to approve normalized trade relations with China this year, claiming an improved economic relationship would produce major trade benefits for information technology companies and other businesses.
In a letter to House and Senate leaders, Clinton said the trade agreement his administration negotiated with China in November will reduce tariffs on a wide range of American goods exported to China. For the IT industry, the deal will mean a drop in tariffs on computers, semiconductors and Internet-related equipment from an average of 13 percent to zero by 2005.
Tariffs on agricultural products and industrial goods will also decrease, but not to zero, Clinton said. As part of the agreement, China would become a member of the World Trade Organization. The trade agreement also opens China's vast and growing market to U.S. service industries, such as telecommunications, banking and insurance.
Clinton said normal trade relations with China will help push the Chinese government toward economic and social reforms that the United States favors.
"For these reasons, I will make it a top priority in the new year to seek congressional support for permanent normal trade relations with China," the president said.
Clinton said Chinese membership in the WTO will provide U.S. companies with the means to combat things such as forced technology transfers and local content requirements that force companies to set up overseas factories to sell products overseas.
Clinton also warned of the consequences if Congress fails to approve normal trade relations with China.
"Our Asian and European competitors will reap these benefits," and American businesses and farmers may be left behind, he said.
As the president's letter was being delivered to Capitol Hill, a major high-technology industry group, the American Electronics Association, announced that its top legislative priority for 2000 is securing a congressional vote to accord China permanent normal trade status.