U.S. exports are on the move. The question is, where are they going?
The first answer is: Up. According to the U.S. Department of Commerce, in December 2017 exports rose $3.5 billion over the previous month, to more than $203 billion. Today, more than 300,000 American companies are bringing their goods to global customers, and nearly 98 percent of those traders are small businesses or mid-sized organizations.
The second answer is more complex, because growth varies from region to region over time. Where are the outbound goods actually landing, and where will expansion occur in the future? While Canada and Mexico are our largest trading partners for exports, there are some critical markets that will be gaining serious attention in 2018, beginning with several countries in central and eastern Europe.
With growing economic prospects, increasing consumer interest in e-commerce and technology, and strategically important connections throughout Europe, many eastern European countries are primed for an expansion in trade.
As this Financial Times article notes, “nowhere in the world have expectations for growth changed so rapidly and positively as in central and eastern Europe.” Your organization should closely examine these markets to see if exporting, importing or investment makes sense:
The economic picture in Poland is strong, and unemployment rates are dropping. A member of the European Union (EU) since 2004, the country represents the largest market among the former Eastern Bloc countries of central Europe. According to the International Trade Administration, key areas for U.S. investment and exports include automotive, aerospace, information technology, food products, transportation, pharmaceuticals, paper production, appliances and financial services.
With a GDP per capita in 2014 of $29,900, Slovenia, though small, is one of the best economic performers in central and eastern Europe. Its well-educated workforce, stability and central location are key reasons for its appeal for investors and traders. Top areas for trade include environmental equipment, information technology, agriculture and pharmaceuticals.
In 2016, the GDP growth rate in the Czech Republic was 2.3 percent, and unemployment continues to be among the lowest in the EU. While the country’s economy is primarily export-driven, imports play a growing role, with Germany, China and Poland topping the list. The United States was thirteenth among source countries as of 2016. Top areas for trade include agriculture, aircraft parts and aircrafts, automotive parts and equipment, and cosmetics.
With an economy that is among the fastest-growing in the EU, Romania offers excellent potential for trade, especially in the areas of agricultural machinery and equipment, defense, education and training, and environmental technologies.
Like other European nations, Hungary was deeply affected by the global financial crisis of 2008. Today, however, economic signs are positive and trade is growing in the areas of agriculture, automotive, biotechnology, and consumer goods and electronics.
Lithuania, Latvia and Estonia are all moving higher on the trade radar for U.S. companies. The Baltic region is strategically located between western Europe and Russia and Asia, and economic growth is strong. In Latvia, for instance, GDP grew by 2 percent in 2016, and was forecast to increase by 3.2 percent in 2017 (final numbers are not yet available).
Key trade areas in the region include agricultural products, information technology, pharmaceuticals and medical devices.