Foreign or international trade is the exchange of capital, goods, and services across international borders or territories. Without international trade, nations would be limited to the goods and services produced within their own borders. Hence, increasing international trading is crucial to the continuance of globalization.
It is interesting to explore the most popular world trading partners of the United States. Examining the numbers behind a country's trading relationships sheds light on the extent of economic interdependence between nations.
Let us take a look at the listing of the current top world trade partners of the United States. The data in this report is year-to-date and comes from the US Census Bureau. It represents the total trade of goods - both imports and exports - from January 2014 through July 2014.
Total Trade: $381.1 billion
Percent of Total US Trade: 16.7%
US Exports: $180.6 billion
US Imports: $200.5 billion
Trade Gap: $19.9 billion
Total: $322 billion
Percent of Total US: 14.1%
US Exports: $68 billion
US Imports: $254 billion
Gap: $186 billion
Total: $308.2 billion
Percent of Total US: 13.5%
US Exports: $139.1 billion
US Imports: $169.1 billion
Gap: $30 billion
Total: $116.8 billion
Percent of Total US: 5.1%
US Exports: $38.8 billion
US Imports: $78 billion
Gap: $39.2 billion
Total: $99.6 billion
Percent of Total US: 4.4%
US Exports: $29.4 billion
US Imports: $70.2 billion
Gap: $40.8 billion
Total: $66.2 billion
Percent of Total US: 2.9%
US Exports: $26.4 billion
US Imports: $39.8 billion
Gap: $13.4 billion
Total: $62.7 billion
Percent of Total US: 2.7%
US Exports: $31 billion
US Imports: $31.7 billion
Gap: $0.7 billion
Total: $46.2 billion
Percent of Total US: 2%
US Exports: $18.4 billion
US Imports: $27.8 billion
Gap: $9.4 billion
Total: $42.7 billion
Percent of Total US: 1.9%
US Exports: $10.4 billion
US Imports: $32.3 billion
Gap: $21.9 billion
Total: $41.8 billion
Percent of Total US: 1.8%
US Exports: $24.9 billion
US Imports: $16.9 billion
Gap: $8 billion (in US favor)
It is interesting to note that in this period, the top 10 countries represent approximately 73.2% of the $2.3 trillion in total US foreign trade, with a total trade gap of $369.9 billion (the value that imports exceed exports) overall. Out of the 10 biggest trading partners, only one have trade gap in the United States' favor (meaning that the US exports have been greater than the imports).
Based on the above data, we also observe some specifics about the US top trading partners such as:
- Canada, Mexico, China, South Korea and Japan
- China, Canada, Mexico, Japan and Germany
From the statistics seen above, it is evident that foreign trade is an important component of any economy, generally accounting for a significant share of gross domestic product (GDP). Here the trade is mostly restricted to trade in goods and services rather than trade in capital, labor or other factors of production. This is because international trade is costlier than domestic trade due to the additional costs like tariffs, border delays or country differences such the legal system or culture.
This is where the international trade (and traders) of the US is largely dependent on "logistics" companies which encompass the distribution, transportation and inventory management sections of the international demand-supply chain.
Many logistics companies provide a one-stop solution for global transportation by offering a single or any combination of shipping methods that gets the cargoes where they need to go in the most time and cost-effective manner possible. Through their consulting services, the company also helps its clients to overcome the specific challenges that the trader faces by formulating customized long-term logistical plans to maximize time and budget.
Often, purchasing and procurement services can be expensive for business corporations to handle "in house". A good company will go that extra mile by offering complete procurement services along with supply chain management services. Such a feature provides greater relief to the traders; they don't have to worry about the selecting the right vendor (in terms of reliability or geographical position) or the quality of raw materials. So, whether your company needs to purchase wholesale computer parts, home and garden equipment or consumer electronics and handles the freight from door to door.
Along with the promise of worry-free end-to-end transportation services, these companies also provide attractive discounts on import and export products from time to time.
It is the presupposition of international trade that a sufficient level of geopolitical peace and stability are prevailing in order to allow for the peaceful exchange of trade and commerce to take place between nations.
