Original Press Release
NAM Notes Surplus With Free Trade Partners
Press release date: February 11, 2009
Manufactured Goods Deficit Fell $60 Billion In 2008
WASHINGTON, D.C. February 11, 2009 -- The trade figures for 2008 released today by the U.S. Department of Commerce showed the United States manufactured goods trade deficit fell from $499 billion to $439 billion, a $60 billion drop, and the U.S. recorded a trade surplus with its free trade partners.
"The improvement in manufactured goods was larger than the $25 billion improvement in the services balance and the $18 billion improvement in the agricultural balance combined," said Frank Vargo, NAM Vice President for International Economic Affairs. "The overall deficit declined only marginally, from $700 billion in 2007 to $677 billion in 2008, because of the cost of energy imports."
Manufactured goods exports rose 7 percent in 2008, to $1.05 trillion, while imports rose less than 1 percent, to $1.49 trillion. "The brightest part of the U.S. trade picture was with our free trade partners, where U.S. manufactured goods trade moved into a surplus," Vargo said. "For the full year of 2008, trade with all U.S. free trade partners as a group was in surplus by $17 billion. This reality is in sharp contrast to the popular view that U.S. trade agreements are the principal reason for the U.S. trade deficit. Rather, these data confirm that free trade agreements are in our national interest."
Vargo noted that the trade picture looked a lot different at the end of the year than it did in earlier months. "U.S. manufactured goods exports boomed through August, with blistering double-digit rates of growth," he said. "However, the boom came to an end in September and since then exports have declined rapidly. December 2008 exports of manufactured goods were 10 percent smaller than December 2007."
The Commerce report showed that imports of manufactured goods grew slowly through most of the year. "This trend reflected the more competitive dollar and slowing demand for consumer goods in the United States," Vargo said. "However, like exports, imports plunged toward the end of the year as the decline in U.S. economic growth accelerated. December imports of manufactured goods were 9 percent smaller than in December 2007."