2024-09-23-彼得森经济研究所-撤销中国永久正常贸易关系（PNTR）地位的经济影响（英）_17页_470kb

Summary of "24-9 Economic Implications of Revoking China's Permanent Normal Trade Relations (PNTR) Status"

Core Content

This Policy Brief by Megan Hogan, Warwick McKibbin, and Marcus Noland analyzes the economic implications of revoking China's Permanent Normal Trade Relations (PNTR) status, which was granted by the United States in 2000 as part of China's accession to the World Trade Organization (WTO). The authors use the G-Cubed model, a multicountry, multisector hybrid dynamic stochastic general equilibrium-computable general equilibrium model, to simulate the effects of such a revocation on the US, China, and other countries.

Main Points

• Historical Context:

  • PNTR status was granted to China in 2000, replacing the more restrictive Column 2 (Smoot-Hawley) tariff schedule.
  • It reduced trade uncertainty and spurred foreign direct investment and trade expansion.

• Economic Impact of PNTR Revocation:

  • Short-term:
    • US GDP would decline relative to the baseline, with no full recovery.
    • The most affected sectors are agriculture, durable manufacturing, and mining.
    • Inflation would rise by 0.2 percentage points (0.4 if China retaliates).
    • The US dollar would appreciate against the yuan, reducing the price of imports from other countries and somewhat offsetting the tariff-induced price increases.
  • Long-term:
    • Workers would shift from trade-exposed sectors to the services sector, but real wages would fall.
    • Production would shift from China to other countries, including Canada and Mexico.
    • The US trade deficit would likely widen, contrary to the intentions of proponents of the policy.

• Chinese Response:

  • China could retaliate with similar tariff increases, which would amplify the negative effects.
  • Retaliation would increase job losses in agriculture and durable manufacturing, which are the most vulnerable sectors.
  • Chinese GDP would decline by 0.6 percent in 2025, with the impact worsening over time.

• Model Assumptions and Structure:

  • The G-Cubed model includes the G20 economies and four regions.
  • It incorporates standard macroeconomic features such as intertemporal general equilibrium, rigidities, and monetary and fiscal policy rules.
  • Productivity growth is a key driver of economic growth in the model.
  • The model assumes a "permanent" revocation of PNTR, leading to long-term structural changes in trade and production.

• Sectoral Effects:

  • The model identifies that the most trade-exposed sectors (agriculture, durable manufacturing, and mining) would experience the largest declines in output.
  • The impact of PNTR revocation would be more severe if China retaliates, as seen in the significant drop in equity prices in affected sectors.

• Trade Balance:

  • The US trade balance would deteriorate due to a decline in US savings relative to investment.
  • China's trade balance would initially improve due to reduced US imports, but this would be offset over time by capital outflows and currency depreciation.

• Policy Implications:

  • Revoking PNTR would likely result in unintended consequences, such as reduced US industrial output and a wider trade deficit.
  • It could also lead to adverse distributional effects and damage diplomatic relations with third countries that import Chinese intermediates.

Key Information

• PNTR Revocation Scenario:

  • Would move trade from the Column 1 to Column 2 tariff schedule, leading to higher tariffs on Chinese imports.
  • The change would be significant, but the current level of trade protection already limits the full impact of the revocation.

• Retaliation:

  • If China retaliates, the economic impacts would be even more severe.
  • Retaliation would likely increase job losses in agriculture and durable manufacturing, which are the sectors targeted by the new tariffs.

• Model Results (2025-2028):

  • US GDP: Falls by $94.9 billion without retaliation, and by $158.7 billion with retaliation.
  • Durable Manufacturing: Output falls by $532.2 billion with retaliation.
  • Nondurable Manufacturing: Output falls by $181.8 billion with retaliation.
  • Agriculture: Output falls by $70.1 billion with retaliation.
  • Energy: Output falls by $40.7 billion with retaliation.
  • Mining: Output falls by $11.5 billion with retaliation.
  • Services: Output increases by $9.9 billion with retaliation.
  • Inflation: Rises by 0.4 percentage points by 2028 without retaliation, and by 0.6 percentage points with retaliation.

• Exchange Rate and Capital Flows:

  • The US dollar would appreciate by 6 percent in the short run.
  • Capital would flow out of China, leading to a depreciation of the yuan and a shift in production to other countries.

• Policy Outcomes:

  • The policy would harm the US industrial sector and contribute to a widening trade deficit.
  • The intended effect of reducing trade surpluses with China is not achieved; instead, the trade deficit widens.
  • The policy is likely to be politically costly and economically detrimental.

Conclusion

Revoking China's PNTR status would lead to significant economic costs for the United States, including reduced GDP, higher inflation, and job losses in key sectors. The intended effect of improving the trade balance and protecting domestic industries is undermined by the policy's actual outcomes. The model also shows that Chinese retaliation would exacerbate these negative effects. The authors conclude that such a policy is not aligned with the goals of US trade policy and could have long-term adverse consequences for the US economy.