Restricting US Investment in China Would Be Worrisome, Says ex-White House Economist

When the Trump administration first threatened Section 301 tariffs on Chinese goods in a notice 18 months ago, few expected 15 percent to 30 percent duties would be in place now on more than half of Chinese imports, with virtually all the rest facing tariffs by Dec. 15, Chad Bown, trade economist at the Peterson Institute for International Economics, told a Washington International Trade Association conference Wednesday. But the markets "haven't panicked," said Bown, a former White House senior economist during the Obama administration. The tariffs in place the longest are on inputs and capital goods, not consumer products, he said. That's one reason for the unexpectedly subdued economic impact, he said. In the context of the overall size of the U.S. economy, "we don't actually trade all that much" in those goods, he said. Bown and Cinnamon Rogers, CompTIA executive vice president-public advocacy, expressed anxiety about media reports that President Donald Trump might restrict U.S. investments in China as further escalation of the trade war. "I don't think it's imminent," said Bown, but it's worrisome. Any new restrictions the U.S. puts on American investment in China would harm international trade and “global economic growth,” said China's Foreign Affairs Ministry Monday (see 1909300032). The White House didn't comment.