Page 23 - THE SOUTH CHINA BUSINESS JOURNAL
P. 23
ional importance (civil aviation, semiconductors, • U.S. aviation industry: Depending on
chemicals, and medical devices). the extent of decoupling, a loss of access to China’s
market for U.S. aircraft and commercial aviation
The report generally uses a full decoupling services would create U.S. output losses ranging
scenario—defined as bilateral flows going to zero— from $38 billion to $51 billion and cause the U.S.
because it provides the most complete look at the civil aviation manufacturing industry to shed
potential impact of the current trajectory of the 167,000 to 225,000 jobs. Cumulatively, lost U.S.
U.S.-China economic relationship. market share impacts would add up to $875 billion
by 2038.
Rhodium’s Daniel Rosen, principal author of the
report, said, “U.S.-China engagement was always • U.S. semiconductor industry:
contingent on shared liberal economic goals. As Depending on the extent of decoupling, a loss
Beijing diverges back toward greater state planning, of access to Chinese customers for the U.S.
a less permissive stance is necessary. But our semiconductor industry would cause $54 billion to
self-interest lies in purposeful decoupling, not a $124 billion in lost U.S. output, risking more than
gratuitous pulling apart. This study is a step toward 100,000 U.S. jobs, $12 billion in R&D spending,
re-sizing our engagement rationally.” and $13 billion in capital spending.
Aggregate Costs: If the U.S. and China were • U.S. chemicals industry: From the
to fully decouple, American businesses and our imposition of tariffs alone, the potential cost ranges
economy would be significantly impacted, resulting from $10.2 billion in U.S. payroll and output
in hundreds of billions in foregone GDP and capital reductions and 26,000 lost jobs, to $38 billion in
gains losses while undermining U.S. productivity output losses and nearly 100,000 lost jobs.
and innovation.
• U.S. medical devices industry: U.S. lost
• Trade: $190 billion annually in foregone market share is valued at $23.6 billion in annual
U.S. GDP by 2025 if 25% tariffs are placed on all revenue, which would compound to cumulative lost
two-way trade. revenue exceeding $479 billion over a decade or
approximately $48 billion annually. Lost revenue
• Investment: $25 billion annually in lost would lead to job losses and translate into a $33.5
capital gains and one-time GDP losses of up to $500 billion reduction in R&D spending over the next
billion if U.S. companies reduce cumulative FDI in decade.
China by 50%.
“U.S. chemical manufacturers have announced
• People: $30 billion annually in lost U.S. more than $200 billion in new investments over the
services trade exports if Chinese students and past decade, accounting for more than 50 percent of
tourists coming to the U.S. drop by 100%. U.S. manufacturing plant construction,” said Chris
Jahn, president and CEO, American Chemistry
• Ideas: Billions in reduced R&D spending Council. “China is one of our largest exporting
in the U.S.; diminished access to Chinese talent and destinations as well as a key source of inputs.
science; and greater competition with China for Limiting access to growth markets like China would
global innovators. have a comparatively more adverse effect on U.S.
manufacturing than it would on China.”
“Fully decoupling the U.S. from China
would undermine America’s leadership in CHAMBER’S LONG-STANDING
semiconductors,” said John Neuffer, president and COMMITMENT TO A BALANCED
CEO of the Semiconductor Industry Association. APPROACH TO CHINA
“While we need to have smart and targeted
restrictions to protect national security, the long- Since its founding, the U.S. Chamber of Commerce’s
term answer to competition from China is to China Center has long advocated for a balanced
turbocharge U.S. innovation through robust federal and rational approach to commercial relations with
and private investments in research and technology China, which we believe is in the interest of the
– that’s how we are going to stay on top, keep our United States and the U.S. business community.
economy strong, and power job growth.” We will continue to be a vocal proponent of open
markets and free trade that is mutually beneficial,
Industry Costs: Full decoupling would lead to safe, and secure, while also remaining a vocal critic
tremendous U.S. output losses for strategic U.S. of trade and commercial practices that present
industries, weakening their ability to sustain U.S. challenges to the rules-based global economic order
jobs, R&D, and global technology leadership. or are unfair to American businesses.
SOUTH CHINA BUSINESS JOURNAL 20
chemicals, and medical devices). the extent of decoupling, a loss of access to China’s
market for U.S. aircraft and commercial aviation
The report generally uses a full decoupling services would create U.S. output losses ranging
scenario—defined as bilateral flows going to zero— from $38 billion to $51 billion and cause the U.S.
because it provides the most complete look at the civil aviation manufacturing industry to shed
potential impact of the current trajectory of the 167,000 to 225,000 jobs. Cumulatively, lost U.S.
U.S.-China economic relationship. market share impacts would add up to $875 billion
by 2038.
Rhodium’s Daniel Rosen, principal author of the
report, said, “U.S.-China engagement was always • U.S. semiconductor industry:
contingent on shared liberal economic goals. As Depending on the extent of decoupling, a loss
Beijing diverges back toward greater state planning, of access to Chinese customers for the U.S.
a less permissive stance is necessary. But our semiconductor industry would cause $54 billion to
self-interest lies in purposeful decoupling, not a $124 billion in lost U.S. output, risking more than
gratuitous pulling apart. This study is a step toward 100,000 U.S. jobs, $12 billion in R&D spending,
re-sizing our engagement rationally.” and $13 billion in capital spending.
Aggregate Costs: If the U.S. and China were • U.S. chemicals industry: From the
to fully decouple, American businesses and our imposition of tariffs alone, the potential cost ranges
economy would be significantly impacted, resulting from $10.2 billion in U.S. payroll and output
in hundreds of billions in foregone GDP and capital reductions and 26,000 lost jobs, to $38 billion in
gains losses while undermining U.S. productivity output losses and nearly 100,000 lost jobs.
and innovation.
• U.S. medical devices industry: U.S. lost
• Trade: $190 billion annually in foregone market share is valued at $23.6 billion in annual
U.S. GDP by 2025 if 25% tariffs are placed on all revenue, which would compound to cumulative lost
two-way trade. revenue exceeding $479 billion over a decade or
approximately $48 billion annually. Lost revenue
• Investment: $25 billion annually in lost would lead to job losses and translate into a $33.5
capital gains and one-time GDP losses of up to $500 billion reduction in R&D spending over the next
billion if U.S. companies reduce cumulative FDI in decade.
China by 50%.
“U.S. chemical manufacturers have announced
• People: $30 billion annually in lost U.S. more than $200 billion in new investments over the
services trade exports if Chinese students and past decade, accounting for more than 50 percent of
tourists coming to the U.S. drop by 100%. U.S. manufacturing plant construction,” said Chris
Jahn, president and CEO, American Chemistry
• Ideas: Billions in reduced R&D spending Council. “China is one of our largest exporting
in the U.S.; diminished access to Chinese talent and destinations as well as a key source of inputs.
science; and greater competition with China for Limiting access to growth markets like China would
global innovators. have a comparatively more adverse effect on U.S.
manufacturing than it would on China.”
“Fully decoupling the U.S. from China
would undermine America’s leadership in CHAMBER’S LONG-STANDING
semiconductors,” said John Neuffer, president and COMMITMENT TO A BALANCED
CEO of the Semiconductor Industry Association. APPROACH TO CHINA
“While we need to have smart and targeted
restrictions to protect national security, the long- Since its founding, the U.S. Chamber of Commerce’s
term answer to competition from China is to China Center has long advocated for a balanced
turbocharge U.S. innovation through robust federal and rational approach to commercial relations with
and private investments in research and technology China, which we believe is in the interest of the
– that’s how we are going to stay on top, keep our United States and the U.S. business community.
economy strong, and power job growth.” We will continue to be a vocal proponent of open
markets and free trade that is mutually beneficial,
Industry Costs: Full decoupling would lead to safe, and secure, while also remaining a vocal critic
tremendous U.S. output losses for strategic U.S. of trade and commercial practices that present
industries, weakening their ability to sustain U.S. challenges to the rules-based global economic order
jobs, R&D, and global technology leadership. or are unfair to American businesses.
SOUTH CHINA BUSINESS JOURNAL 20
