Ebb & Flow: Trade, exports and FDI

There’s a lot of talk right now about trade agreements. Not all of the usual suspects are in support of two proposed free trade agreements in this political cycle. Some blame NAFTA and free trade in general as elements that have reduced the middle class in the U.S., while building the middle class in Mexico and elsewhere. Yet, in 2015, almost 50 percent of U.S. exports went to the 20 countries the U.S. currently has free trade agreements with. Those countries do not include any in Europe, nor do they include China or Japan.


We do have free trade agreements with Australia, South Korea, Israel, Singapore, several countries in Central and South America, and, of course, Mexico and Canada. With the FTA countries, the U.S. enjoyed a trade surplus in manufactured goods of about $12 billion last year. Not so much with those we do not have trade agreements with. . .regarding those countries, we have a trade deficit of about $500 billion.


There are two major trade agreements that are currently proposed. One is with the European Union and the United States, trading partners that accounted for about one-third of U.S. exports last year. Called the Transatlantic Trade and Investment Partnership (TTIP), it is a companion agreement with the Trans-Pacific Partnership (TPP). That agreement…Read More

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