Increasing trade deficits

Higher trade deficits have been reported in both the UK and the USA.

Even in recession the US trade deficit in 2009 was well over $1Billion per day. As reported by the Department of Commerce it was $380.7 bn for all of 2009. This was the lowest for eight years!! However, the December deficit was 10% higher than November. Economists expect the trade deficit to rise in 2010.

The UK too has shown a similar pattern of trade imbalance, even with the decrease in the value of the Sterling. The Office of National Statistics reported that the December deficit was £7.3bn compared with the November deficit of £6.8bn.

Note China has overtaken Germany as the world's largest exporter.

The question remains - how are we all going to pay our way???