Senate Panel to Focus Today on the U.S.-China Trade, Economic Relationship
Later this afternoon, at 2 p.m. ET, ITI’s Dean Garfield will testify at a Senate Banking subcommittee hearing focused on the economic and trade relationship between the U.S. and China. You can listen through C-SPAN. Here is his full testimony, and some highlights are below.
The ability to freely access foreign markets such as China and compete on equal terms has been critical to the health of the tech sector, and has underpinned the United States as an innovative economy. Maintaining free and open global markets will support our economic recovery and help achieve a shared goal of promoting U.S. exports. Indeed, U.S. exports to China are on the rise. Last year, our exports to China were nearly $104 billion, up four-fold from a decade ago. Yet, U.S. tech companies operating in the China market continue to face increasingly challenging and complex market access barriers.
The time has finally come to develop a more comprehensive strategy to defeat these policies at a global level, promote the global benefits of effective policies that support open markets and nondiscriminatory innovation, and defend growth, innovation, and job creation. This strategy should focus on those countries where retrograde policies are most acute and serious, and are increasingly being recognized by developing governments such as India and Brazil. While this effort needs to include a high-level, comprehensive tier of work, it must also be tailored for individual markets. Recent successful efforts by a broad array of private-sector coalitions to roll back discriminatory industrial policies in China and India can serve as effective models for these efforts.
This means the U.S. government, in collaboration with the private sector, must communicate to these governments a clear vision for viable alternatives to which they can turn to achieve the results they want in fostering innovation and development. This includes understanding that governments can and will continue an important role in fostering innovation, such as through promoting STEM education or creating tax incentive for R&D. At the same time, governments must clearly recognize that most innovation comes from the private sector. In the short term, we suggest that the U.S. government begin to address these concerns at the G20 to be held next month in Mexico City.
Our industry is already working with the U.S. government to identify and analyze the most pertinent challenges, and to provide other governments possible solutions. More is needed, however, to raise the level of attention – both within the United States and with our trading partners – regarding the existence of these challenging problems and how to combat them creatively. These steps are necessary to ensure that American technological competitiveness remains strong.
In addition to Dean, other witnesses are Stephen Roach, Senior Fellow at Yale University's Jackson Institute of Global Affairs; Dr. C. Fred Bergsten, Director of the Peterson Institute for International Economics, and John Dearie, Executive Vice President for Policy at the Financial Services Forum.
Without question, the relationship between the United States and China has major ramifications for the U.S. economy as well as the global marketplace. We appreciate the Senators for taking the time to dive into these issues and to help chart a path forward to meet the challenges that we face today.
Check back throughout the afternoon for updates from the hearing.