Manufactured Goods Trade With FTAs moves into surplus.
Press Release Summary:
According to NAM President John Engler, manufactured goods trade with U.S. FTA partners has moved into surplus for first time. Surplus reflects improving trend in trade with FTA partner countries that has been going on for 5 years. In 2002, manufactured goods deficit with those countries was $41 billion, but by 2007 deficit had fallen to $27 billion. And now, deficit is gone. Engler calls for quick approval of agreements pending before Congress for Colombia, Korea, and Panama.
Original Press Release:
NAM Says U.S. Now Enjoys Trade Surplus With Free Trade Agreement Countries In Manufacturered Goods
GUESS WHAT? MANUFACTURED GOODS TRADE WITH FTAs MOVES INTO SURPLUS FOR FIRST TIME
"Indisputable Proof that Trade Agreements Work for America," Says Engler
WASHINGTON, July 15, 2008 - The National Association of Manufacturers (NAM) announced today that manufactured goods trade with U.S. free trade agreement (FTA) partners has moved into surplus for the first time.
"This is huge, and people need to take notice," said NAM President John Engler. "Contrary to the widely-held view that our trade agreements are the cause of the U.S. trade deficit, FTAs are actually the brightest part of our trade picture.
"Through May, manufactured goods trade with our FTA partners was in surplus by nearly a half billion dollars," said Engler. "While this is a modest surplus, it contrasts sharply with our $176 billion deficit with countries who are NOT our free trade partners.
"Moreover, this surplus reflects an improving trend in trade with FTA partner countries that has been going on for five years," said Engler. "In 2002 the manufactured goods deficit with those countries was $41 billion (11 percent of our total manufactures deficit), but by 2007 the deficit had fallen to $27 billion (5 percent of the deficit). And now, so far in 2008, the deficit is gone. We have a surplus.
"This is going to come as a shock to many in the Congress who have been misled by isolationists telling them a 'failed trade policy' of bilateral trade agreements has been at the heart of our trade deficit," Engler said. "Nothing could be further from the truth, and I call for quick approval of the agreements now pending before Congress - Colombia, Korea, and Panama - so we can get even more benefits from FTAs.
"The facts are indisputable: trade agreements work for America," said Engler. "While we don't necessarily expect trade agreements to generate surpluses, we do expect them to create a level playing field where America's manufacturers and workers can compete fairly, and clearly that has been happening. Holding back more trade agreements will only harm the expansion of U.S. exports, which are now the mainstay of the U.S. economy.
"Every day that Congress continues to delay in passing the Colombia agreement, for example, costs U.S. manufacturers about $2 million in additional import penalties they have to pay to sell U.S.-made goods in Colombia," Engler stressed.
Census Bureau data below show how the U.S. manufactured goods trade balance with FTA partners has improved over the last five years and moved into a surplus position.
Manufactured Goods Trade Balance with Free Trade Partners and Rest of World, 2002-2007 and Jan-May 2008
Billions of Dollars
Country 2002 2007 JAN-MAY
2008
Total, All FTA Partners -$41.2 -$26.8 $0.5
NAFTA -$44.3 -$39.4 -$8.6
CAFTA -$1.7 $1.1 $0.9
Australia $9.0 $12.9 $6.2
Bahrain $0.0 $0.0 $0.1
Chile $0.9 $1.3 $1.1
Israel -$5.9 -$8.5 -$3.9
Jordan -$0.1 -$0.6 -$0.2
Morocco $0.2 $0.2 $0.2
Singapore $0.8 $6.3 $4.7
Non-FTA Partners -$327.6 -$472.0 -$175.9
Total, All Countries -$368.8 -$498.9 -$175.4
FTA % of Total 11.2% 5.4% SURPLUS!
Source: Foreign Trade Division, Census Bureau, U.S. Dept of Commerce
SITC 5-9 Total Exports less General Imports
