2022: 7.8% of manufacturing, 12.7% services, 9.6% agriculture, 8.5% fuels & mining
2017: 9.4% of manufacturing, 14.4% services, 9.8% agriculture, 6.7% fuels & mining
* Data from the WTO’s annual World Trade Statistical Review reports, 2023 and 2018.
The International Monetary Fund’s most recent World Economic Outlook, launched last Thursday, reports that in 2022, the world’s GDP topped eleven digits for the first time to reach $100.1 trillion. The WTO’s latest World Trade Statistical Review report, meanwhile, shows exports of goods in 2022 at $24.9 trillion and exports of services at $7.0 trillion. Combining the two, this means $31.9 billion, and a matching 31.9% of world output, crossed borders. This is high in historical terms — possibly the highest export-share-of-GDP ever — reflecting the energy price spike caused by Russia’s war on Ukraine along with post-COVID surge in shopping for consumer goods, reviving travel and transport services, high farm prices, and probably some acceleration of trade integration in Asia. A table of these totals in the recent past and the last two decades:
2022: 31.9%
2021: 29.4%
2020: 26.5%
2019: 28.6%
2017: 28.4%
2012: 29.6%
2002: 22.4%
Tentative conclusion: The high 2022 export-to-GDP ratio probably reflects some temporary factors; in particular, without the energy price spike it would have been somewhere around 29%. But it also suggests that at least so far, the trade conflicts of the past five years haven’t very fundamentally changed trade flows.
Three closer-level looks — at products and “sectors,” countries, and the United States — offer some backup to this general conclusion, but also suggest areas where flows have at least shifted course:
Products: The largest single chunk of world exports is in manufacturing, which in 2022 accounted for $15.3 trillion, or about 48% of all world exports, slightly below the 52% of pre-pandemic 2019. The $15.3 value nearly equals the roughly $17 trillion in world manufacturing output; top exports were $3 trillion in chemicals, $2.5 trillion in IT goods, and $1.5 trillion in autos and auto parts. In second place comes $5.1 trillion in energy and mining, where the supply shock caused by the war nearly doubled trade value from 2017’s $2.63 trillion. Then came $3.3 trillion in digitally deliverable services ranging from entertainment and media to finance, software, gaming, air and hotel reservations, and so on; $2.3 trillion in food and farm goods; $1.5 trillion in miscellaneous goods-trade categories such as scrap metal, small-scale parcel deliveries, and returned purchases; and $1.4 trillion in transport and travel services.
So: Assuming the high energy prices were temporary, little about the world “traded-product” mix changed very much in the last five years.
Countries: The countries at the top of the WTO’s export rankings also remained pretty stable. The largest single block of merchandise trade was either (a) the European Union’s $5.4 trillion in manufacturing exports (which is shaky as it counts $3.25 trillion in trade among the 27 EU members as well as $2.14 trillion from the EU to other countries), or (b) if you take the EU as a lot of individual countries rather than one big economy, China’s $3.3 trillion in manufactures. Counting down from this, the WTO’s rankings of “top exporters” and ‘top importers’ haven’t changed very much in any of the big product divisions. The top six manufacturing exporters in 2022 – China, EU-as-a-single-economy, the U.S., Japan, Korea, Mexico – are identical to the top six of 2017, though Taiwan and Singapore swap 7th and 8th place, and Vietnam replaces Canada in tenth. In agriculture, likewise, the top six exporters are identical, though Thailand jumps over Mexico and Australia to place 7th. Rankings in “fuels and mining” (which in WTO argot includes metal ores) have changed most¸ with the U.S. climbing past Saudi Arabia and Russia to become the top exporter.
Hmm: Despite the “301” tariffs the Trump administration placed on most Chinese goods in 2018 and early 2019, China’s #1 share of world manufacturing exports rose from 17.8% to 21.7%. The U.S. held its #2 manufacturing rank, but the American share of manufacturing exports shrank from 9.4% to 7.8%.
The U.S.: How did the U.S. fare as all this proceeded? From 2017 to 2022, the U.S. held its second-place share as a goods exporter, lengthened its lead as the world’s top goods importer, and remained the top services trader. So to date — despite “301” and “232” tariffs, withdrawal from the Trans-Pacific Partnership Agreement, renegotiation of the North American Free Trade Agreement, sanctions on Russia, and a battery of new export controls — no very revolutionary changes in the actual U.S. world role. A slightly more granular level, though, reveals some shifts:
1. U.S. export economy is a bit smaller and more concentrated in energy: The U.S. export economy shrank a bit (in relative terms), from 12.2% of GDP in 2017 to 11.6% in 2022. Meanwhile, the Census’ count of U.S. exporting businesses fell from 290,600 in 2017 to (a preliminary) 279,000 in 2022. Energy exports however jumped from a historically very high 9.1% of total exports in 2017 – $141 billion of $1547 billion – to an all-time record 18.2% in 2022, or $380 billion of $2086 billion. Mirroring these domestic figures, the WTO finds the U.S. with a lower share of world manufacturing exports and a higher share of energy. Overall, then, not a very inspiring result. One explanation is benign: heavy stimulus spending causing a consumer boom and diverting exports to domestic customers. Another is less encouraging: an unanticipated effect of tariffs, as the “301” and “232” tariffs imposed in 2018 and 2019 fell heavily on industrial inputs, and thus likely raised U.S. factory costs and eroded competitiveness, especially as Asian countries continued to cut tariffs on one another’s goods.
2. Americans import more, especially in manufacturing: Imports, by contrast, rose from 14.9% of U.S. GDP to 15.4%. This is the highest import share since 2014. Most of the jump reflects a post-pandemic surge in import of manufactured goods, which rose in dollar terms by $740 billion from the levels of 2014. Mirroring this rise, the WTO tables show Americans buying 14.1% of world manufactured exports in 2017, and 15.7% in 2022. With exports only up $70 billion, the Trump administration’s pledge to reduce U.S. manufacturing trade deficits ended with a comically perverse doubling of the sectoral deficit from -$648 billion in 2016 to -$1.3 trillion in 2022.
3. Less from China, more from Vietnam and Mexico: Within the totals, though, U.S. sourcing has shifted noticeably. China’s share of U.S. imports, at 21.6% in 2017, fell to 16.3% in 2022; Vietnam and Mexico, and secondarily India and other ASEAN countries, picked up most of the roughly $150 billion in diverted imports. In 2023 (based on the Census figures complete through last August) this drop accelerated, with China falling behind both Mexico and Canada as U.S. import sources. This noted, China’s higher share of worldwide manufacturing exports suggests that (a) Chinese firms were able to replace lost U.S. customers with sales elsewhere, and/or (b) some of China’s diminishing share of American imports reflects shifts of final assembly to other middle-income countries, in which case China would be exporting components and parts to factories abroad and the U.S. still the final buyer. See below, though, for a third possibility — the early stages of vaguely geopolitical “trade blocs” — suggested by WTO economists this month.
The WTO’s annual World Trade Statistical Review back to 2015, with links to the earlier “International Trade Statistics” yearbooks from 2000 to 2014.
… An accompanying WTO staff report, Global Trade Outlook and Statistics, looks around at 2023 and ahead to 2024, and predicts slower trade growth for the next year and a half. Under the heading “Evidence of Fragmentation” (pg. 12), the authors see initial signs of that trade flows may be beginning to reflect “geopolitical blocs”:
Economic and political tensions between the United States and China — the world’s two largest economies – have been building for several years, leading to the imposition of numerous tariffs. These measures have sparked some changes in international trading patterns, but evidence that they have thrown globalization into reverse remains limited. …
Changes in trade shares along geopolitical lines are also discernible in recent data. For example, US trade in parts and components with politically like-minded countries as measured by UN voting patterns fell from 77% before the pandemic in 2019 to 73% afterwards in 2020. This share then rose to 74% in 2022 and finally back to 77% in 2023. While this could be a sign of supply chains shifting for geopolitical reasons, it could also simply be a reversion to pre-pandemic production patterns.
… and thoughts on it all from WTO Chief Economist Ralph Ossa.
And for context, the IMF’s just-updated World Economic Outlook database.
U.S. data:
Census’ monthly summaries of imports, exports, and balances.
… or by country (goods only).
And the Bureau of Economic Analysis has GDP breakdowns, services trade, and more.
Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.
Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.
Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank Progressive Economy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.
Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007). He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.
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