Computer Industry Facts

• Exports to China of U.S. computer and office equipment increased well over 500 percent between 1990 – 1998.
• With annual growth rates of 20 – 30 percent, the market in China for computers is expanding rapidly, according to the International Data Group.
• In fact, China’s personal computer (PC) market is growing twice as fast as the world average and is expected to be the world’s second-largest PC market – surpassing Japan – by the end of this year.

Why PNTR with China is Important

• Congress must extend normal trade relations to China on a permanent basis in order for American computer firms to take advantage of the unprecedented market opportunities presented by China’s membership in the WTO.
• China has committed to comprehensive reform of its economy, and to lower and eliminate tariffs and non-tariffs barriers to trade, regulatory requirements and investment restrictions.
• As a result of this historic step, the American computer sector is poised to expand its exports to this rapidly growing market, increase high-wage American jobs, and continue our technological leadership and competitiveness in international markets.
• China has agreed to adopt the Information Technology Agreement (ITA), which eliminates China’s customs duties on computers and peripherals – which currently average 10–15 percent – by 2003.
• China has also agreed to extend full trading and distribution rights to foreign firms within two years of accession. These important rights not only allow American computer firms the ability to import and export without going through a middleman, but distribution rights in particular allow U.S. companies the ability to provide direct, quality after-sales service and support.
• Under WTO rules, if the U.S. were to withhold permanent normal trade relations for China, our competitors would enjoy preferential access to China’s market. Without PNTR, U.S. computer companies stand to lose sales and market share in this important market, as well as the high-paying U.S. jobs that support them. Indeed, salaries in American’s high-tech sector outstrip the average private sector wage by nearly 80 percent.
• The U.S. High-Tech Coalition seeks timely Congressional approval of permanent normal trade relations (PNTR) with China in order for the U.S. to fully apply the WTO rules and for the American computer industry to reap the benefits of the market opening reforms China has agreed to undertake.