Recent developments.

• Author: Youssef, Michael
• Position: U.S. TRADE DEVELOPMENTS - Statistical data

U.S. International Trade in Goods and Services

The U.S. Department of Commerce reported that seasonally adjusted exports of $97.5 billion, and imports of $149.0 billion in September 2004, resulted in a goods and services deficit of $51.6 billion, about $2.0 billion less than the $53.5 billion deficit in August 2004. September 2004 exports of $97.5 billion were about $0.8 billion more than August 2004 exports of $96.7 billion. (2) September 2004 imports of $149.0 billion were $1.2 billion less than August imports of $150.2 billion.

September 2004 merchandise exports increased by about $0.9 billion to $68.9 billion from August 2004 exports of $68.0 billion. Merchandise imports decreased by about $0.5 billion to $124.5 billion from August 2004 imports of $125.0 billion. The merchandise trade deficit decreased by about $1.4 billion in September 2004 to about $55.6 billion from about $57.0 billion in August 2004.

For services, exports decreased by about $0.2 billion to $28.5 billion in September 2004 from August 2004 exports of $28.7 billion. Imports of services decreased by about $0.7 billion to $24.5 billion in September. The services trade surplus in September increased by $0.6 billion to $4.0 billion from $3.4 billion in August 2004. Services exports decrease of about $0.2 billion from August to September was due to decreases in travel and other transportation (which includes freight and port services), which was partly offset by an increase in other private services (which includes items such as business, professional, and technical services, insurance services and financial services). Changes in other categories of services exports were small. Services imports decrease of $0.7 billion from August to September was accounted for by a decrease in royalties and license fees which had been boosted in August by payments for broadcast rights for the 2004 Summer Olympic Games. Changes in other categories of services imports were small.

Changes in merchandise exports from August to September 2004 reflected increases in food, feeds, and beverages ($0.6 billion); industrial supplies and materials ($0.5 billion); capital goods ($0.3 billion); and consumer goods ($0.3 billion). Decreases occurred in automotive vehicles, parts, and engines ($0.1 billion). The August to September 2004 changes in imports of goods reflected decreases in industrial supplies and materials ($0.7 billion); "other goods" statistical category ($0.3 billion); and in foods, feeds and beverages ($0.1 billion). Increases occurred in capital goods ($0.4 billion); and automotive vehicles, parts, and engines ($0.2 billion). Consumer goods were virtually unchanged.

In September 2004, exports of advanced technology products were around $17.3 billion and imports of the same were about $20.4 billion, resulting in a deficit of about $3.2 billion, about $1.3 billion less than the August 2004 deficit of $4.5 billion. Exports of these products in September 2004 of $17.3 billion were more than those recorded in August of $16.0 billion. But imports of advanced technology products of $20.4 billion in September 2004 were about the same as those of August 2004 imports.

The September 2004 trade data showed U.S. surpluses with the following countries (preceding month in parentheses): Australia, $0.6 billion ($0.6 billion in August); Hong Kong, $0.5 billion ($0.4 billion); Singapore, $0.3 billion ($0.6 billion); and Egypt, $0.1 billion ($0.1 billion). Deficits were recorded in September 2004 with China, $15.5 billion ($15.4 billion); Western Europe, $7.9 billion ($10.0 billion); the European Union (EU 25), $7.7 billion ($9.6 billion); OPEC member countries, $6.7 billion ($7.0 billion); Japan, $6.1 billion ($6.4 billion); Canada, $5.3 billion ($6.0 billion); Mexico, $3.8 billion ($3.7 billion); Korea, $2.1 billion ($1.5 billion); Taiwan, $1.1 billion ($1.5 billion); and Brazil, $0.9 billion ($0.6 billion).

During September 2003-September 2004, the change in exports of goods reflected increases in industrial supplies and materials ($3.3 billion); capital goods ($3.2 billion); consumer goods ($1.1 billion); automotive vehicles, parts, and engines ($0.9 billion); "other goods" statistical category ($0.4 billion); and foods, feeds, and beverages ($0.2 billion). The September 2003-September 2004 changes in imports of goods reflected increases in industrial supplies and materials ($9.8 billion); capital goods ($4.4 billion); consumer goods ($2.6 billion); automotive vehicles, parts, and engines ($1.9 billion); other goods statistical category ($0.2 billion); and foods, feeds, and beverages ($0.2 billion).

From September 2003 to September 2004, services exports increased by $2.5 billion. The largest increases were in travel ($0.8 billion); other private services which includes items such as business, professional, and technical services; insurance and financial services ($0.8 billion); and other transportation ($0.5 billion). From September 2003 to September 2004, services imports increased $2.8 billion, with the largest increases in other private services ($0.8 billion); other transportation ($0.8 billion); and travel ($0.7 billion).

The January-September 2004 trade data show surpluses with Belgium, $3.3 billion (for January-September 2003, $3.9 billion); the Netherlands, $8.9 billion ($6.6 billion); Hong Kong, $4.9 billion ($3.2 billion); Australia, $5.0 billion ($5.1 billion); Singapore, $3.8 billion ($1.2 billion); and Egypt, $1.4 billion ($1.0 billion). Deficits were recorded with Canada, $49.3 billion ($38.5 billion); Mexico, $33.4 billion ($31.0 billion); Western Europe, $82.7 billion ($72.1 billion); the euro area, $60.5 billion ($53.8 billion); European Union (EU 25), $79.9 billion ($70.6 billion); European Union (EU 15), $75.6 billion ($67.0 billion); France, $7.4 billion ($8.4 billion); Germany, $33.1 billion ($28.2 billion); Italy, $13.0 billion ($11.3 billion); United Kingdom, $7.0 billion ($5.9 billion); EFTA, $5.5 billion ($4.3 billion); Pacific Rim countries, $202.1 billion ($167.9 billion); China, $114.3 billion ($89.7 billion); Japan, $55.2 billion ($48.2 billion); Korea, $14.2 billion ($9.0 billion); Taiwan, $9.7 billion ($11.1 billion); and OPEC, $51.9 billion ($38.2 billion).

Additional information on U.S. trade developments in agriculture and specified manufacturing sectors during August 2004 is highlighted in table 1 and table 2, and figure 1 and figure 2. Services trade developments are highlighted in table 3. It should be noted that individual European countries shown here are also included in the euro area and in the European Union groupins. Likewise, individual Asian countries mentioned are also included in the Pacific Rim countries grouping. U.S. trade developments with major trading partners are highlighted in table 4.

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World Trade Developments in 2003

In April 2004, the World Trade Organization (WTO) announced that stronger-than-expected global economic growth, particularly in the United States and Asia, spurred a recovery in world trade during 2003. The following are highlights of the WTO press release. (3)

Improved economic conditions in the United States and Asia boosted world trade in 2003, with Asia and the transition economies recording the most dynamic trade expansion in 2003. The value of world merchandise trade rose by 16.0 percent to $7.3 trillion in 2003. World trade in services rose by 12.0 percent to $1.8 trillion. However, WTO estimated that more than two thirds of the rise in the nominal value of world merchandise trade was attributable to changes in the dollar price in terms of other major currencies.

According to the WTO, U.S. import growth exceeded the world average thus mitigating sluggish world trade growth over the last few years in the rest of the world. However, imports exceeding exports widened the U.S. trade deficit. U.S. merchandise imports rose by 9.0 percent while exports rose by 4.0 percent. In other countries and areas, imports in Western Europe rose by 18.0 percent, and exports rose by 17.0 percent. Asian merchandise exports and imports expanded by 17.0 percent and 19.0 percent respectively. China's imports expanded by 40.0 percent and exports expanded by 35.0 percent, showing unprecedented strength in Chinese economic expansion. Latin America's exports rose by 9.0 percent, sustained by a recovery in demand for primary products, particularly from Asia. Developing countries' merchandise exports expanded by 17.0 percent in 2003, slightly faster than their imports and the world average, which consequently widened their trade surpluses. Oil exporting countries recorded nominal export growth in excess of 20.0 percent (table 5).

The WTO estimated that commodity prices and exchange rate changes led to a 10.5 percent strengthening of world merchandise trade prices in 2003. For the first time since 1995, dollar prices increased for both agricultural and manufactured products. However the impact of price and exchange rate developments on nominal trade flows differed by region. As West European currencies appreciated against the dollar, the dollar merchandise export value of Western Europe expanded at a rate faster than world trade despite a near stagnation in volume terms.

WTO also noted that commercial services developments by region differed from merchandise trade by region due to the predominant role played by exchange rate movements. In merchandise trade, all regions recorded stronger nominal export and import growth in 2003 compared to 2002. In services trade, Asia's exports are estimated to have expanded at 6.0 percent in 2003, a lower rate than the 8.0 percent expansion in 2002. Western Europe recorded gains of 17.0 percent in their services exports and of 16.0 percent in their imports. The transition economies recorded annual gains of 19.0 percent in their services exports, and 21.0 percent in services imports. Increases in services exports from Asia increased only 6.0 percent annually...