U.S./China trade deficit widens
The widening rift between the U.S. deficit and Chinese surplus in trade in manufactures showed no sign of abatement in the fourth quarter of 2014.
According to an analysis from the MAPI Foundation, the research affiliate of the Manufacturers Alliance for Productivity and Innovation, the U.S. trade deficit in manufactures in the fourth quarter rose by $19 billion, or 14%, compared with 2013, and increased by $61 billion, or 12%, for calendar year 2014.
In the report, Ernest Preeg, Ph.D., MAPI Foundation senior advisor for international trade and finance, estimates this led to a net loss of 425,000 American manufacturing jobs.
Meanwhile, the Chinese surplus in manufactures increased by $35 billion in the fourth quarter and rose by $85 billion for the year to $998 billion, which rounds to a record $1 trillion annual surplus. Quarterly Chinese exports of $614 billion more than doubled the $302 billion of U.S. exports. This represents a dramatic change from 2000, when U.S. manufactured exports were three times larger than Chinese exports.
"The 3% growth in U.S. manufactured exports in 2014 completes President Obama's five-year strategy to double U.S. exports, but manufactured exports were up by only 41% during that time," Preeg notes. "In stunning contrast, Chinese manufactured exports soared by 96% over the last five years."
Chinese exports in 2014 for the 10 largest high-technology industries were $1,135 billion, 48% larger than the $769 billion of U.S. exports, and while China had a $322 billion surplus in these industries, the United States was in deficit by $290 billion.
The largest U.S. bilateral deficits in manufactures in 2014 were with China, at $372 billion, or 66% of the global deficit, followed by Japan at $83 billion (15%) and Germany at $73 billion (13%). The United States had a $17 billion surplus with NAFTA partners Canada and Mexico, composed of a $63 billion surplus with Canada and a $46 billion deficit with Mexico.
INDUSTRIAL SUPPLY MAGAZINE
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