ITC Issues Annual Report of Services Trade; Focus on Infrastructure Services
The International Trade Commission released its report entitled “Recent Trends in U.S. Services Trade, 2012 Annual Report.” The report presents a statistical overview of U.S. trade in services and highlights some of the service sectors and geographic markets that contribute substantially to recent services trade performance.
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Report Focuses on Infrastructure Services
This year's report focuses on infrastructure services, such as banking and telecommunications, which are essential to a country's overall economic growth and development and are used by every firm regardless of economic sector. The report also includes separate chapters on specific industries (banking, insurance, logistics, retail, securities, and telecommunications). These chapters analyze global competitive conditions in the industry, examine recent trade performance, discuss non-tariff measures that affect trade, and summarize the industry's outlook.
Key findings of the report include:
Services Trade Growth Rebounds. In 2010, U.S. cross-border services exports increased by 9 percent, following a 2005--09 compound annual growth rate (CAGR) of 8 percent. This growth was spread across service industries, led by industrial engineering, passenger fares, and training services. U.S. services imports grew by 6 percent in 2010 (identical to the 2005--09 CAGR), led by advertising, database and other information services, and trade-related services.
Infrastructure services account for about a third of services trade. Infrastructure services accounted for 25 percent of total U.S. cross-border services exports and 37 percent of U.S. cross-border services imports in 2010. Exports of such services totaled $132 billion while imports totaled $135 billion, resulting in a small cross-border trade deficit. Financial services led U.S. infrastructure services exports and accounted for a large trade surplus, while insurance services made up the largest share of U.S. infrastructure services imports and yielded a large trade deficit.
Affiliate transactions account for majority of infrastructure services trade. As in prior years, affiliate transactions accounted for the majority of U.S. trade in infrastructure services. Foreign affiliates supplied $641 billion of such services in 2009, while purchases of services from U.S. affiliates totaled $403 billion. This yielded a surplus of $238 billion, larger than the trade balance of professional services, agriculture, or manufacturing. Infrastructure services accounted for 60 percent of both sales through foreign affiliates and purchases from U.S. affiliates in 2009.
Continued growth in logistics trade. The increasing globalization of production and supply chains continued to drive growth in global logistics revenues, which increased from $417 billion in 2006 to $551 billion in 2010. Global third-party logistics firms developed industry-specific supply chain expertise and expanded the reach of their transportation networks, and manufacturers outsourced a wider range of supply chain functions to such firms, including repairing laptops and managing the end-to-end transportation and distribution of pharmaceuticals.
Although the U.S. remained the largest logistics market in 2010 with 23 percent of global revenues, this was a decline of 4 percentage points compared to 2006; during this period China and Brazil rapidly gained market share, becoming the second- and seventh-largest logistics markets respectively.
ITC press release on the report on trade in services available here.