Trade improves quality of life and economic growth

0

Since the beginnings of people living in social groups millennia ago, goods have been exchanged in one form or another. Through imports and exports, consumer choice improves, prices are reduced, business opportunities expand and economies grow. The essential mathematics explaining the process were worked out in the early 1800s. The pandemic-induced supply chain problems illustrated the interconnectedness of the contemporary world and how dependent consumers are on a steady stream of imports.

Trade is necessary for the proper functioning of the economy. Most of the products exported from the United States have been manufactured or processed in the country, creating opportunities for companies that manufacture, market, transport, process, create or otherwise participate in the production chain as well as their employees. The training effects increase the benefits. For imported goods, there are downstream impacts for inputs to manufacturing processes, and even finished goods lead to logistics, retail sales, and other activities.

Overall US import volumes fell during the worst of COVID-19, but rebounded. The total value of imports was $2.8 trillion in 2021. Of this amount, consumer goods were $766.7 billion, capital goods (which are a range of products ranging from semiconductors and computers to telecommunications equipment to aircraft) was $762.8 billion and industrial supplies (which include oil) were $649.4 billion. The rest included automobiles; food, feed and beverages; and many other goods. Exports in 2021 totaled nearly $1.8 trillion, with the top categories being industrial supplies ($635.5 billion), capital goods ($519.6 billion), and consumer goods ( $222.1 billion).

About three-quarters of all trade is with our top 15 trading partners. Exports to Canada totaled $307.6 billion, followed by Mexico ($276.5 billion). Next come China ($151.1 billion), Japan ($75.0 billion), then South Korea, Germany and the United Kingdom. The highest import values ​​came from China ($506.4 billion), Mexico ($384.7 billion), Canada ($357.2 billion) and Germany (135. $2 billion), followed by Japan, Vietnam and South Korea.


Surprisingly, about 20% of all US exports go from Texas to overseas markets. Major products include petroleum (crude oil as well as refined products and, increasingly, liquefied natural gas); electronic processors and computer equipment; aircraft, engines and parts; and chemicals. The main markets are Mexico, Canada, China, South Korea, Brazil, Japan, the Netherlands and the United Kingdom.

As US companies sell to global markets, they increase their volumes and revenues as well as job opportunities. Imports include not only consumer goods, but also inputs for the production of other goods. Trade improves the quality of life and the potential for growth. The logistical blockage and associated delays have caused disruptions in this multi-trillion dollar flow. However, the data indicates that volumes are on a decidedly upward trend and that the problems that have plagued international trade are being resolved. This result is both excellent and essential. Stay safe!

Mr. Ray Perryman is President and Chief Executive Officer of The Perryman Group (www.perrymangroup.com).

Share.

About Author

Comments are closed.