When a country's imports out number its exports (items delivered from that country to a foreign destination), it can skew its trade balance and weaken its currency. Since the value of a currency is one of the most important indicators of a country's economic performance and gross domestic product, its depreciation can considerably impact the daily lives of its citizens (GDP). A country's ability to maintain an optimum balance of imports and exports is critical. A country's importing and exporting activity can impact its GDP, exchange rate, inflation, and interest rates.
· Employment: Export growth has the potential to generate new jobs. Export jobs have traditionally been in the manufacturing sector, which is a significant source of full-time employment, particularly in industrial regions. In recent years, exports have become more diverse, with a greater reliance on service sector-based exports, such as computer programming.
· Economic expansion: Exports are a component of total demand (AD). Rising exports will contribute to higher AD and economic growth. Export growth can also have a knock-on effect on related "service industries." Similarly, a drop in exports during a global economic downturn can significantly negatively impact the United States' economy.
· The current account deficit exists: The current account deficit is heavily influenced by the strength of exports. The United States has had a persistent current account deficit over the last few decades, which many attributes to the country's relatively poor export performance.
In 2020, the United States shipped $1.431 trillion in goods to international markets. This figure represents a -13 percent decrease from $1.645 trillion in total global exports from all countries one year earlier in 2019. From a continental standpoint, 32.7 percent of US exports by value were delivered to North American trade partners, while 32.4 percent were delivered to Asian importers. Another 22.5 percent of goods were delivered to Europe. Smaller percentages went to Latin America, excluding Mexico but including the Caribbean (9%), Oceania (1.9%), led by New Zealand (1.9%), Australia, and Africa (1.9%). (1.5 percent).
The following is a list of 15 of America's top trading partners in terms of US export sales in 2020, countries that imported the most American shipments by dollar value. The percentage of total American exports for each import country is also shown.
· Canada: USD 255.1 billion (17.8 percent of total US exports)
· Mexico: USD 212.7 billion (14.9 percent)
· China receives $124.6 billion (8.7 percent)
· Japan has $64.1 billion (4.5 percent)
· United Kingdom: £59 billion for the (4.1 percent)
· Germany: 57.8 billion dollars (4 percent)
· South Korea: $51.2 billion (3.6 percent)
· Netherlands received $45.5 billion (3.2 percent)
· Brazil: $35 billion (2.4 percent)
· Taiwan: $30.5 billion (2.1 percent)
· France: 28.3 billion dollars (2 percent)
· Belgium: $27.6 billion (1.9 percent)
· India: $27.4 billion (1.9 percent)
· Singapore: $27.1 billion (1.9 percent)
· Hong Kong $24 billion (1.7 percent)
In 2020, the above 15 trade partners will account for nearly three-quarters (74.8 percent) of American exports. China has the only increase in purchases of US exported goods from2019 to 2020 among these top trading partners, with a 16.9 percent increase. France (down -27%), Hong Kong (down-22.1%), Belgium (down -20.6%), and India were the top decliners (down -20.4 percent).
Overall, the United States incurred a -$976.1 billion trade deficit in 2020, up 5.7 percent from the -$923.2billion in red ink for all products in 2019. According to economists, a country with a negative trade balance or deficit has a total value of all imported goods that is greater than the total value of all exports.
It would be unrealistic for any exporting country to expect positive trade balances with all its importing partners. Similarly, an exporting country does not always have a negative trade balance with each partner with whom it exchanges exports and imports.
The following countries had the highest trade deficits with the United States.
· China: -US$332.5 billion (country-specific trade deficit in 2020)
· Mexico: -$116.2 billion
· Vietnam: -$73.2 billion
· Germany: -$59.6 billion
· Japan: -$58.4 billion
· Switzerland: -$57.5 billion
· Ireland: -$56.2 billion
· Malaysia: -$32.8 billion
· Taiwan: -$32 billion
· Italy: -$31.1 billion
US deficits with Switzerland (up109.1 percent), Taiwan (up 29.2 percent), and Vietnam (up 25.2%) grew at the fastest rate among America's trading partners that caused the greatest negative trade balances from 2019 to 2020.
These cashflow deficiencies clearly show America's competitive disadvantages with the countries above. Still, they also represent important opportunities for the US to develop country-specific strategies to strengthen its overall position in international trade.
According to economists, a country with a positive trade balance or surplus has a total value of all imported goods that is less than the total value of all exports. The following countries had the highest trade surpluses with the United States.
Two of the trading partners increased the amount of black ink generated by the US, namely the United Kingdom (up 61.2 percent) and Egypt (up 12.3 percent).
Belgium (down -55.5 percent), Australia (down -40.9 percent), Hong Kong (down -38.5 percent), Panama (down-30.3%), and the United Arab Emirates led the decliners (down -25.5 percent ).
These positive cash flow streams demonstrate America's competitive advantages over the countries above. They also represent critical opportunities for the US to develop country-specific strategies to optimize its overall position in international trade.
The top US corporations transported products from the United States to their global import partners. The product category in which the American company specializes is shown in brackets.
· Koch Enterprises (recovered waste paper, plastic scrap, animal feeds)
· Paper of International Concern (paper, packaging)
· DeLong's (animal feed, grain)
· Denison International, Inc. (recyclable paper)
· DuPont's (diversified chemicals)
· RockTenn/MeadWestvaco (paper, packaging)
· Metal Management Sims (recycled metals, electronics)
· International Newport CH (recycled paper, metals, plastics)
· Prospective Industries (paper for recycling)