Trump's Chinese tariffs could slow cloud market in US, report suggests

Jessica Kim Cohen - Print  | 

The Trump administration's decision to impose tariffs on Chinese goods may threaten the leadership of the U.S. in the cloud computing market, according to a September report by a public policy and technology think tank.

In June, President Donald Trump proposed tariffs of up to 25 percent on $200 billion of Chinese imports in an effort to counteract reputedly unfair Chinese trade practices while bolstering the U.S.'s competitive edge in the global market.

However, the Trump administration's tariffs would advantage IT competitors in other countries, according to the report by the Information Technology and Innovation Foundation.

Today, the U.S. is a leader in cloud computing, in both adoption and provision. In 2017, the U.S. spent an estimated $70 billion on public cloud services. Under the tariffs, however, U.S. tech companies may not be able to find suppliers to support key components of their cloud businesses.

"While contesting Chinese innovation, mercantilism remains a laudable and necessary mission, the Trump administration should seek alternative policy measures that do not raise the cost of key productivity- and innovation-enhancing capital goods and services such as information technology and cloud computing," the report reads.

To download the Information Technology and Innovation Foundation's report, click here.

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