Despite a delay by the U.S. Congress in voting on the Colombia free trade agreement, U.S. trade with the South American country is growing strongly. In fact, Colombia is the Latin American country that is seeing the strongest growth in trade with the United States, according to a Latin Business Chronicle analysis of trade data from the US Census Bureau for the first half of the year.
Meanwhile, Peru is the fastest-growing market in Latin America for U.S. goods, while Ecuador is the fastest-growing Latin American exporter to the United States. And Venezuela is again the second-largest U.S. trading partner in Latin America after losing that position last year to Brazil.
All in all, U.S. trade with Latin America reached $318.9 billion in the first half of 2008, an increase of 19.7 percent from the same period last year, according to the Latin Business Chronicle analysis. That means U.S. trade with the region is picking up. By comparison, total trade last year only grew by 6.2 percent.
U.S. exports to Latin America increased 20.6 percent to $132.4 billion. That was twice the growth rate of total U.S. exports to the region during all of last year. Imports from Latin America reached $182.1 billion in the first half of the year, an increase of 16.3 percent from the same period in 2007. That's nearly four times higher than the import growth for the full year in 2007.
The U.S. deficit reached $49.6 billion, a 6.2 percent increase from the first half last year. However, the deficit is largely caused by a few of the larger trade partners, especially Mexico and Venezuela. The United States manage to reach a trade surplus with 13 of its 20 trade partners in Latin America.
MEXICO: TWICE THE GROWTH
U.S. trade with Mexico, its top trade partner in the region, is especially picking up. Total trade reached $183.7 billion in the first half, or 9.6 percent higher than the same period last year. That's twice the growth rate of total U.S.-Mexico trade during all of last year. U.S. exports to Mexico reached $74.0 billion, an increase of 11.0 percent. By comparison, U.S. exports to Mexico only grew by a mere 1.9 percent in 2007. Imports from Mexico are also growing at a faster pace. They reached $109.7 billion in the first half, which was 8.6 percent higher than the same period last year. That growth figure was also higher than the 6.3 percent growth in U.S. imports from Mexico during the full year of 2007.
U.S. trade with Colombia reached $12.2 billion in the first half, an increase of 54.2 percent compared with the same period last year. U.S. exports to Colombia grew by 46.3 percent to $5.7 billion, while U.S. imports from Colombia increased by 61.7 percent to $6.6 billion. The numbers confirm Colombia as the fourth-largest U.S. trading partner in Latin America after Mexico, Venezuela and Brazil, ahead of Chile - the previous number four partner.
Venezuela's dethroning of Brazil is largely due to a strong increase in oil exports to the United States. Venezuela posted a 50.4 percent increase in its total exports to the United States, which reached $25.7 billion in the first half. By comparison, Brazilian exports grew by 20.3 percent to $14.9 billion. The strong Venezuelan exports helped offset weaker import growth - 10.2 percent to $5.5 billion. By comparison, Brazil's imports from the United States grew by 33.4 percent to $14.8 billion. The relative weak performance of U.S. exports to Venezuela, which ha grown by 21.7 percent in the first half of 2007, led to Venezuela losing its rank as the third-largest U.S. export market in Latin America. It now ranks fifth.
PERU: FASTEST-GROWING EXPORT MARKET
U.S. exports to Peru reached $3.0 billion last year, an increase of 72.2 percent. That was the highest growth of any market in Latin America. As a result, Peru jumped from being the 11-th largest U.S. export market in Latin America to the eighth-largest. U.S. imports from Peru grew by 23.4 percent to $2.9 billion. Total trade increased by 44.2 percent to $5.9 billion, leading to Peru becoming the eighth-largest trade partner - an improvement of two spots from last year.
U.S. exports to Chile are also growing strongly. During the first half of the year, they reached a total of $6.5 billion - or 70.5 percent more than the same period last year. That's the second-highest growth rate after Peru. As a result, Chile is now the third-largest U.S. export market in Latin America after Mexico and Brazil. Meanwhile, U.S. imports from Chile increased by 5.5 percent to $4.5 billion.
U.S. trade with Argentina is growing at twice the rates of 2007. During the first half, bilateral trade reached $6.7 billion, which was 44.4 percent higher than the same period last year and more than double the 18.2 percent growth rate for all of 2007. U.S. exports to Argentina grew by 49.9 percent to $3.9 billion, while imports increased by 37.4 percent to $2.8 billion.
U.S. trade with the Dominican Republic, the largest trade partner in the CAFTA trade group, grew by 8.3 percent to $5.3 billion. The growth was due to U.S. exports increasing by 17.8 percent, which helped offset a 4.7 percent decline in U.S. imports from the Dominican Republic.
U.S. trade with Costa Rica, its largest trade partner in Central America, reached $4.8 billion - an increase of 15.8 percent. U.S. exports to Costa Rica grew by 29 percent, while imports from the country increased by a mere 2.1 percent. U.S. trade with the rest of Central America also grew at double-digit rates. That marks a contrast to 2007, when Central American trade with the United States grew by single digits (with the exception of Honduras).
Other noticeable results:
U.S. imports from Ecuador in the first half of the year grew by 64.1 percent to $4.5 billion. That was the highest growth of any country in Latin America. Other growth winners when it came to exporting their goods to the United States include Colombia (61.7 percent), Venezuela (50.4 percent), Argentina (37.4 percent) and Bolivia (28.7 percent).
Uruguay was among the growth winners when it comes to U.S. exports to Latin America (up 70.1 percent), but among the losers when it came to its own exports to the U.S. market (down 61.6 percent).
Despite growing political tension, U.S. trade with Bolivia expanded strongly. Bolivia is among the leading growth winners both in terms of U.S. exports and imports. It still remains the second-smallest U.S. trade partner in Latin America, though. Only Cuba, which has a U.S. embargo against trade, has less trade with the United States.