The U.S. trade deficit with the rest of the world was $56.403 billion in December 2004, slightly less than the $57.4 billion that economists generally expected. However, 2004 was a very bad year for the U.S., with the deficit in goods and services trade deepening to $617.725 billion, a record and some $121.217 billion greater than 2003's $496.508 billion deficit.
In December, U.S. exports of $100.171 billion were more than offset by imports totaling $156.574 billion, the U.S. Commerce Department reported on Feb. 10. For all of last year, U.S. exports of $1.146 trillion in goods and services were outpaced by imports valued at nearly $1.764 trillion. The Washington, D.C.-based National Association of Manufacturers (NAM) figures U.S. trade in manufactured goods ran a record $553 billion deficit in 2004. Although U.S. exports of manufactured goods last year showed some of their strongest growth in recent years, the value of imports grew even faster, the business group notes. Frank Vargo, NAM's vice president for international economic affairs, expects the deficit to be smaller in 2005 as the U.S. dollar and other market-determined currencies return to "more normal" values. "A positive sign is that U.S. exports of manufactures grew more rapidly in December  -- though we would not be surprised to see the deficit grow for a few more months."
In December 2004, the U.S. trade deficit with China was $14.264 billion, some $2.367 billion less than in November. For the full year 2004, the U.S. trade deficit with China was $161.978 billion, the largest with any other single country, larger than the $110.005 billion deficit with the 25 nations in the European Union and larger than the $110.832 billion deficit with NAFTA partners Canada and Mexico. "The record $162 billion deficit with China, up $37 billion in one year, shows that China has got to stop contravening market forces and also fully implement its international trade obligations -- including cracking down on product counterfeiting," says the NAM's Vargo.