US Trade

U.S. Trade Opportunities Ramp Up in India, Asia

Nov. 12, 2012
U.S. companies need to seek out new export markets to capitalize on growth.

While Canada, Mexico and China will remain the top three export destinations for U.S. companies, India is the fastest growing market for U.S. exports, according to a new international trade survey.

Exports to Canada represent close to 20% of total U.S. merchandise exports, according to HSBC Commercial Banking, and will remain the U.S.’s largest trading partner through 2030. HSBC, which produced its new trade forecast report in association with Oxford Economics, says Mexico and China will also retain their respective top three positions. But Brazil will replace the United Kingdom and India will replace Germany as the fourth and fifth largest trading partners, the bank predicts.

Exports to India are expected to grow 12% a year from 2016-2020 and close to 10% a year from 2021 to 2030, with demand fueled by the growth of its middle class. A study by McKinsey has estimated that the middle class in India will number 583 million by 2025.

U.S. exports to Asia (excluding Japan) are forecast to grow at 8% annually on average from 2021-2030. Vietnam is expected to become an increasingly important export market, with double digit annual growth expected from 2012 to 2030. Though at a smaller scale than Asia, exports to the Middle East and North Africa will grow approximately 7% a year, HSBC predicts.

Buoyed by commodity prices, UAE and Saudi Arabia have been particularly strong destinations for U.S. exports this year. UAE imports from the U.S. are expected to rise 55% in 2012, while Saudi Arabia will increase imports from the U.S. by 30%.

While U.S. exports to developing nations will rise rapidly, traditional export markets in Europe will decline in relative importance, HSBC observed. Exports to Europe (excluding Russia) are forecast to rise approximately 4% annually from 2021 to 2030.

Emerging markets will drive trade growth, “with an increasingly important role for smaller countries beginning to register as potential trading nations; ambitious countries brimming with entrepreneurial and confident businesses seeking opportunities to grow,” observes Alan Keir, HSBC group managing director and global head of its commercial banking business. He said U.S. and U.K. companies can capitalize on opportunities in emerging markets by “diversifying beyond their developed market counterparts to seek new opportunities.”

Trade Confidence Dips Slightly

U.S. executive’s trade confidence, after hitting an all-time high six months ago, dipped slightly (111 to 107), according to HSBC’s Trade Confidence Index. Still, 48% of U.S. importers and exporters foresee their trade volumes increasing. And 86% predict their trade business will either grow or hold at current levels over the next six months. Asked about obstacles to growth, 40% of those surveyed said they would relate to costs of shipping, logistics and storage.

The top three trading partners for U.S. businesses remain Canada, Latin America and China, companies reported. While 30% think the Latin America hold the greatest potential for trade growth in the coming months, 22% bleive China is the region with the most promise.

Despite a number of troubling issues in the world economy, 65% of U.S. businesses anticipate the global economy will either remain at current levels or grow in the near future.

About the Author

Steve Minter | Steve Minter, Executive Editor

Focus: Leadership, Global Economy, Energy

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An award-winning editor, Executive Editor Steve Minter covers leadership, global economic and trade issues and energy, tackling subject matter ranging from CEO profiles and leadership theories to economic trends and energy policy. As well, he supervises content development for editorial products including the magazine,, research and information products, and conferences.

Before joining the IW staff, Steve was publisher and editorial director of Penton Media’s EHS Today, where he was instrumental in the development of the Champions of Safety and America’s Safest Companies recognition programs.

Steve received his B.A. in English from Oberlin College. He is married and has two adult children.

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