America needs to unleash the full potential of the high-tech economy for consumers by breaking down obsolete government barriers. The high-tech industry is responsible for 44 percent of domestic economic growth since 1994. To keep this engine of growth moving, we must remove the heavy hand of government regulation and taxes. That is why CSE believes we must keep the Internet free from taxation.

Yet, in today’s global economy many of the barriers to growth faced by the high-tech industry are created in foreign markets. America must find a way to break down barriers imposed by foreign governments. China is a prime example. China is now the leading high-tech market in Asia (excluding Japan) with 20 percent to 40 percent annual growth. By next year, experts estimate 20 million Internet users in China, which represents a huge and rapidly growing opportunity for America’s cutting edge industry.

But today, Chinese government barriers keep America’s high-tech industry from seizing these opportunities. For example, high tariffs on computers and computer chips keep U.S. products out of the Chinese market. Arcane technology transfer rules discourage investment by our most productive industries.

America can remove these obsolete barriers in China. In fact, we have negotiated an elimination of all Chinese tariffs on computers, semiconductors, software and other hi-tech products by 2005. China also has agreed to eliminate technology transfer requirements. More importantly, China has agreed to adopt international rules and practices for e-commerce and allow U.S. firms to participate in that country’s exploding Internet market. In exchange, America simply needs to make permanent the normal trade relations status we routinely grant China year, after year. This is the same normal trade status we grant virtually every other country on the globe. If we don’t, other nations are waiting to pounce on the huge high-tech opportunities in the Chinese market.

CSE supports permanent normal trade relations with China. CSE believes that U.S. consumers will benefit by removing obsolete Chinese government barriers to competition and innovation.

To view our letter to Congress on the subject, click here.