How Dependent Are US Consumers on Imports From China?

June 7, 2016 3:45 AM

If you are in the market for a new cell phone or a laptop, you better hope that the United States does not impose punitive tariffs on China. For these, and many other products, China is the main US supplier.

For most goods, however, imports would just shift to other foreign suppliers if the United States were to greatly restrict trade with China. For example, 14 percent of men’s suits come from China, so high tariffs on China would simply shift imports to other major suppliers like Italy, Canada, Mexico, Indonesia, Turkey and Vietnam.  

But for 825 products, out of a total of about 5,000, adding up to nearly $300 billion, China supplies more than all our other trade partners combined. Of these products, the most important is cell phones, where $40 billion in imports from China account for more than three-quarters of the total value imported. For many of these goods consumers could shift to other suppliers, but price hikes and reduced variety would yield large welfare losses. And of course, Apple would lose ground to Samsung—hardly a win for the United States.

There are also 83 products where 90 percent or more of US imports come from China; together these accounted for a total of $56 billion in 2015. The most important individual product in this category is laptop computers, which alone have an import value of $37 billion from China, making up 93 percent of the total imported (see table). Electrical machinery and equipment is the most important broad category with high China shares, with 10 products in the sector recording shares above 90 percent. For products with such high market shares, it would be very hard to switch suppliers. 

In addition to electronics, our Christmas lights would dim and our false beards would fray with China out of the market.

Top ten US imports with 90+ percent share from China, 2015
Rank by import value HS code Product name Imports from China Share of total US Imports 
1 847130 Laptops $37,100,000,000 93%
2 950410 Video games with TV $4,741,392,000 98%
3 950510 Articles for Christmas festivities $2,052,987,000 93%
4 640291 Rubber boots $1,461,358,000 92%
5 841451 Ceiling fans $1,274,984,000 96%
6 950590 Other holiday articles $881,226,100 92%
7 630140 Synthetic blankets & rugs $754,178,800 93%
8 670420 Wigs, false beards, eyebrows & other articles of human hair $626,695,500 91%
9 851310 Portable electric lamps  $615,634,300 93%
10 940530 Christmas lights $515,716,900 91%
HS = Harmonized System 
Source: UN Comtrade database.

Comments

Tony

Does this list consider include oil or nuclear resources? or consumer goods?

Caroline Freund

Yes the list considers all goods.

Add new comment