A Background on US Economy
The United States is located in the middle of the North American continent. It plays a vital role in world trade and is said to be very influential in multinational organizations like the World Bank and the United Nations. Back then, it has been an important opponent of the USSR which is the most powerful Communist country. In 1990, though, the competition was eliminated thus permitting greater cooperation between two of the world's strongest nations. Unluckily though for USSR, US proved to be tougher because the former was dissolved in 1991. This led to the division of the nation with different countries now comprising the former Soviet.
It was in 1989 when the US reached a Gross National Product (GNP) amounting to $5.2 trillion. This was considered as the highest in the world. The per-capita income also raged reaching as high as $21,082 for the said year and ranked among the world's highest in the category.
Two and a half percent (2.5%) of the GNP was divided among agriculture, fishing and forestry. The country's leading crops include corn, soybeans, wheat, tobacco, hay, cotton, rice, sorghum and potatoes. It is considered as the world's largest producer of meat, corn and soybeans and ranks second for wheat and tobacco production and hog and cattle-raising.
Twenty percent (20%) of the GNP goes to its different industries. Leading the list are transportation equipment, chemicals, processed foods, printing and publishing, fabricated metal products, industrial machinery and equipment, instruments and related products, paper and allied products, primary metals and electrical and electronic equipment. Its heavy industry concentrates on primary metals such as steel, copper and aluminum which in facts lead the world's list in terms of export and production.
On the mining side, mineral fuels such as coal, petroleum and natural gas are considered important components. Other principal minerals of the country are cement, stone, copper, iron, sand and gravel, ore, lime, salt, clay, phosphates, uranium, zinc, sulfur, molybdenum, silver, gold and lead. Tourism is also a significant industry in the nation.
To date, the US remains to be one of the most-favored nations of other countries who participate in world trade. Although, it has stronger export partners as well as suppliers, the country sees to it that it does not favor any nation it deals with. It was always seen as a supporter for democracy, independence and security. It also delivers US funds for nations which seek economic transformation. Technical assistance is also extended by the nation to its comrades in international business.
The Major Trade Partners of US
The US Census Bureau always keeps a track record of the major trade partners of US all over the world. The statistics gathered by the agency provides up-to-date information. As a matter of fact, the latest census as of November 2008 provided the following as major trade partners of the US:
Major Products Exported From The US
- Based on Total Trade of Goods. The year-to-date total exports of US to other nations amounted to $1.21 trillion while its total imports from other countries made $1.96 trillion in the market. This brings the year-to-date total trade in goods to $3.17 trillion. Based on the totals, Canada leads the major trade partners of US which made 17.7% of the total at $560.4 billion. The other countries included on the top fifteen include: China - $379.0 billion or 11.9%; Mexico - $343.0 billion or 10.8%; Japan - 191.5 billion or 6.0%; Federal Republic of Germany - $141.3 billion or 4.5%; United Kingdom - $104.9 billion or 3.3%; South Korea - $77.7 billion or 2.5%; France - $ 67.5 billion or 2.1%; Saudi Arabia - $63.3 billion or 2.0%; Venezuela - $60.6 billion or 1.9%; Brazil - $59 billion or 1.9%; Taiwan - $57.8 billion or 1.8%; Netherlands - $56.9 billion or 1.8%; Italy - $48.1 billion or 1.5%; and Belgium - $43.2 billion or 1.4%. These top 15 countries contribute to 71.1% of the year's total with an amount of $2.25 trillion.
- Based on Exports. On the export side, the top 15 countries make up 71.2% of the export total of $1.21 trillion which is equivalent to $862 billion. Still topping the list in terms of exports is Canada with $244.5 billion equal to 20.2% of the year-to-date total. Other top export partners of the US are: Mexico at $141.4 billion; China at 66.3 billion; Japan at $62 billion; Federal Republic of Germany at $50.8 billion; United Kingdom at $50.2 billion; Netherlands at $37 billion; South Korea at $32.9 billion; Brazil at $30.4 billion; Belgium at $27 billion; Singapore and France at $26.9 billion; Taiwan at $24 billion; Australia at $21.0 billion; and Switzerland at $20.6 billion.
- Based on Imports. Considering the imports, the top 15 suppliers of US make up 74.1% of the total imports amounting to $1.45 trillion. Canada is still on the lead at $315.9 billion which is equivalent to 16.1% of the import totals. Other countries joining Canada on top are: china with $312.7 billion; Mexico with $201.7 billion; Japan with $129.4 billion; Federal Republic of Germany with $90.4 billion; United Kingdom with $54.7 billion; Saudi Arabia with $52.1 billion; Venezuela with $49.1 billion; South Korea with $44.8 billion; France with $40.6 billion; Nigeria with $36.6 billion; Taiwan with $33.8 billion; Italy with $33.6 billion; Malaysia with $28.8 billion; and Brazil with $28.6 billion.
The major exports of US to other nations are comprised of agricultural products such as soybeans, fruits and corn; industrial supplies including organic chemicals; capital goods such as transistors, aircraft, computers, telecommunications equipment and motor vehicle parts; and consumer goods such as automobiles and medicines. For the period ending November 2008, US's agricultural exports were led by grains and feeds with a total of $34.97 billion. Other goods found along this line were: soybeans at $13.80 billion; corn at $12.76 billion; wheat at $10.87 billion; read meats and products at $8.16 billion; animal feeds and oil meal at $7.69 billion; Vegetables and products at $4.68 billion; cotton and linters at $4.58 billion; poultry meats and products at $4.56 billion; and fruits and products at $4.48 billion. As a whole, the following US export data are available for the year 2007:
Trade Barriers Facing Foreign Companies
- Top US Exports. For 2007, $1.16 trillion worth of products were exported to the rest of the members of international trade. The chart was topped by semiconductors with an export amount of $50.2 billion. Completing the top ten list were: complete civilian aircraft; automotive parts and accessories; new and used passenger cars; other industrial machines; pharmaceutical preparations; telecommunications equipment; organic chemicals; electric apparatus; and computer accessories. The last item had an export total of $29.4 billion.
- Fastest-Growing US Exports. In 2007, several US goods were commendable for making an increase from its sales in 2006. Topping the list was business machines excluding computers which gained $5.4 billion and was 99.6% higher than in 2006. Joining these items were: wheat; sorghum, barley and oats; dairy products and eggs; oilseeds and food oils; nonmonetary gold; steelmaking materials; soybeans; DVD's, tapes and disks; and musical instruments.
Foreign companies have their own share of fate when it comes to dealing with US. Barriers to trade are also evident at some points. Each country's laws and standards would oftentimes lead to disputes with the US. The US had already patterned its provisions with the ones set by international standards while some countries in the world have their own regulations to follow. The most common trade barriers the US faces when dealing with foreign companies are:
Trade Opportunities With US Exporters
- Import barriers. Tariffs on goods exported by the US to other countries are still imposed. Even if there are treaties which govern the US's trade relations with another nation, this barrier has not yet been eliminated. There are also a lot of concerns on double taxation thus making the transport of goods from America more costly.
- Government Procurement. This problem is oftentimes encountered with the trade relations of US to countries not belonging to the World Trade Organization (WTO). In most cases, even if US companies have won bids to sell products and services to their trading partner's government, processing takes so long. Receiving payments are also a problem since it goes either of two ways. First, payment may take months or even years and second, the payment received is also reduced.
- Intellectual Property Rights Protection. The US had already made specific pacts with other nations when it comes to protection of Intellectual Property Rights and yet problems seem to come along the way. The most common reasons why the purpose of the agreement fails is the lack of transparency of rules and the weakness of the government to institute protection. Piracy of movies and films and even duplication of website content are also issues that still need to be resolved.
- Service Barriers. In some of US's trading partners, certain areas of the service sector do not permit US exports to enter the grounds. The most common conflicts arise in the telecommunications and financial sector. A country's way of thinking is usually geared on protecting the interest of domestic businesses rather than allowing foreign investors to get in the way. The good thing about this is the fact that other nations have already started opening their market to US exporters.
- Investment Barriers. Since the US have made several investment treaties with other countries, investment and trade have already been encouraged between US companies and other territorial jurisdictions. Mutual protection of rights and privileges for investors, nationals and companies alike, had been pushed through. The problem on this aspect arises when the US's trade counterpart has not yet established a stronger ground to facilitate direct investment including the protection of the interest of US investors.
Obviously, the key to opening trade opportunities with the US requires a lot of hard work especially when it comes to the trade barriers. It is always vital to work on rules and regulations first before a trading partner gets the chance to do good business with US exporters. It is better to think about the many products that a US exporter may transfer to another ground rather than seeking greedy measures to increase economic stature. Adhering to international standards is as good as getting a slot in US exports.
There is a wide range of trade opportunities available for countries who want to engage and do business with US exporters. For countries which still lag behind when it comes to exports coming from US, now is the time to persevere. Look into a wide array of products exported by the US. List down the important aspects of trade to know which section needs to be boosted. Take a hint from US Commercial Service which provides ways on how goods and services are marketed worldwide. Export.gov on the other hand, is an outlet for organizing export-related programs and market research information. The list of trade opportunities is clearly differentiated via http://www.commerce.gov/TradeOpportunities/index.htm/.
U.S. Exporters & American Foreign Trade References