The Impact of the United States’ Tariffs on China on China’s Machinery and Equipment Export Trade

Abstract

This paper analyzes the impact of U.S. tariff impositions on China on the exports of China’s key industries, particularly the mechanical equipment sector, amid escalating Sino-U. S. trade frictions. Employing the GTAP model, the study simulates and examines changes in China’s mechanical equipment exports under varying tariff levels. The results indicate that as tariff rates increase, China’s exports of mechanical equipment to the United States decline overall, with the electronic equipment and transportation equipment sub-sectors being the most severely affected. Concurrently, China’s Gross Domestic Product (GDP) and social welfare decrease with rising tariffs, whereas the United States experiences slight growth in both GDP and welfare under certain scenarios. This research provides a quantitative basis for adjusting China’s mechanical equipment export policies and offers strategic recommendations for navigating the high-tariff environment.