America’s trade deficit surged in 2022, nearing $1 trillion
ASSOCIATED PRESS / 2009
A truck runs near piles of containers at Waigaoqiao Container Port in Shanghai, China. China’s leaders have voiced concern that the world economic crisis, which has hit its export industries hard, could spark instability, with some laid-off workers already taking to the streets to demand jobs and benefits.
WASHINGTON >> The overall U.S. trade deficit rose 12.2% last year, nearing $1 trillion as Americans purchased large volumes of foreign machinery, medicines, industrial supplies and car parts, according to data released Tuesday by the Commerce Department.
The goods and services deficit reached $948.1 billion, its largest total on record, after rising $103 billion from the previous year.
The data showed evidence of the U.S. economy’s continuing recovery from the pandemic, which had held down spending on services such as travel and entertainment and pushed up purchases of imported goods. Rapid inflation and higher energy prices were responsible for some of the growth, because the trade data is not adjusted for inflation.
The numbers also showed signs that global supply chains appear to be reshuffling somewhat, as the U.S. government erects more barriers to trade with China and businesses seek to diversify where they get materials and goods.
The U.S. trade deficit in goods with Mexico, Canada, India, South Korea, Vietnam and Taiwan all grew strongly last year as manufacturers sought new sources of foreign products.
Still, many companies have so far proved unwilling or unable to cut ties with China, which continues to house the world’s largest concentration of factories. Despite rising tensions between the world’s biggest economies — which were further strained last week by the discovery of a Chinese spy balloon flying over the United States — trade between the countries remains strong.
Overall trade with China last year easily surpassed previous records, and the U.S. trade deficit with China grew 8.3% annually to $382.9 billion, the second highest total on record.
The overall volume of U.S. imports remained much larger than exports, however, resulting in a trade deficit. Exports of goods and services rose 17.7% to $3 trillion, while imports rose 16.3% to $4 trillion. The strong value of the U.S. dollar also made foreign goods cheaper than American ones, driving up the trade deficit.
One beneficiary of the shift away from China has been Mexico, now a destination for more global factories hoping to serve the United States. Data released Tuesday showed strong growth in trade with Mexico last year, with exports rising 17.3% and imports 18.3%. The U.S. trade deficit with Mexico grew 20.7% to $130 billion.
This article originally appeared in The New York Times.
