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US study sees gains from removing import barriers

Published 09/30/2009, 07:32 PM
Updated 09/30/2009, 07:36 PM
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WASHINGTON, Sept 30 (Reuters) - U.S. consumers would be about $4.6 billion better off each year if the United States eliminated import barriers for sugar, dairy, ethanol, clothing and other goods, the U.S. International Trade Commission said in a report on Wednesday.

"The commission estimates that U.S. economic welfare, as defined by total public and private consumption, would increase by about $4.6 billion annually by 2013 if all significant restraints quantified in this report were unilaterally removed," the report said.

The gains would come as exports expand by $5.5 billion and imports by $13.1 billion annually, the report said.

The study comes as countries are showing renewed interest in completing the Doha round of world trade talks, which aims to expand trade by lowering barriers around the world.

The United States is one of the most open markets in the world and in 2007 the weighted-average U.S. tariff on all imported goods was a historic low of 1.3 percent.

There are still significant import barriers in many politically sensitive sectors.

The ITC has examined the cost of that protection in periodic reports for nearly 20 years.

Its latest update said eliminating tariffs on textiles and clothing would increase U.S. economic welfare by about $2.3 billion annually, or half the projected gains from eliminating all significant import barriers.

Consumers would benefit from lower-priced textiles and clothing, while previous industry contractions would lessen the impact of increased imports on U.S. producers, the ITC said.

Removing tariffs and other restrictions on imports of dairy products would boost U.S. welfare about $733 million annually, and doing the same for raw and refined sugar imports would create a yearly rise of about $514 million, the report said.

It saw the next biggest gain, or $356 million annually, from eliminating a tax on ethanol imports.

Ethanol imports would increase about 183 percent in value, while U.S. industry output and employment would each decline by only about 2 percent, it said.

The report projected no change in overall U.S. employment from eliminating the import barriers, but said jobs would fall about 11 percent in the clothing sector, 7.5 percent in the sugar industry and 1.9 percent among dairy producers. (Reporting by Doug Palmer; Editing by Peter Cooney) (doug.palmer@thomsonreuters.com; +1 202 898 8341; Reuters Messaging: doug.palmer.thomsonreuters.com@reuters.net))

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