An interesting question, especially as we know that there is strong evidence that the major chunk of global growth is estimated to happen outside the shores of the U.S. Therefore could exports be one major facet to boost the U.S. economy in the next few years? Lets see how we have done so far.
The advent of emerging markets such as China, India and Brazil implies that the demand for goods and services will grow in the coming years; hence the U.S. needs to take stock, make smart bi-lateral decisions and tone up the tradeable sectors of its economy. I believe special focus should be given to metropolitan areas of our country, as those will be the drivers of such developments.
Several data confirms that the U.S. export sector is not only profiting large companies, but is also leveraging the skills of local industries and clusters. The National Export Initiative, that we at WTC New Orleans as the only nongovernmental agency hosted, was announced by President Obama in 2010 with an objective of doubling U.S., exports in five years (2009-2014). The target is to reach an ambitious $3.2 trillion by 2014. Therefore the U.S. administration has partnered with businesses to extensively promote US-made services and goods throughout the world within the ambit of global trading rules, in the wake of potential global demand particularly from emerging economies. I think this program is a start in the right direction, but needs to be enforced and brought closer to small businesses. In our organization and region we try to advocate this initiative as much as we can, including Educational pieces and others, but I think it needs a more powerful impetus to achieve such a goal.
Here's a rundown of the data and how we have fared so far. The Brookings Institute recently released an in-depth study about exports in U.S. metropolitan areas. U.S. exports have grown 11.9 percent annually from 2009-12, which contrasts sharply with dismal U.S. GDP growth of 2.2 percent during the same period. In 2012, metropolitan area exports reached a record level of $1.7 trillion. Out of the top 100 metros, 76 registered record volumes in export. Interestingly, 28 percent of total U.S. exports was attributed to the top ten metropolitan areas in 2012 -- Los Angeles, New York and Houston being the top three respectively. Additionally, among the 100 top metros, the export intensity of 11 of them crossed 20 percent in 2012.
Especially areas in the South are very strong contenders as for example New Orleans and Baton Rouge. Post recession, services sector in metros accounted for more than 50 percentof export growth in the U.S. in 2012. Some of the swiftest export growth in the past decade was from the services sector as well. Between 2005 and 2012, five of the fastest growing metropolitan industries were from the services.
Brookings Export Nation data has brought to light two vital messages: First, metropolitan areas have tremendous growth potential and contribute greatly to the country's exports; second, U.S. businesses have responded positively to global demand, with double-digit export growth in the U.S., post recession. Now lets make sure that we build on U.S. export performance, thus enabling U.S. export companies to remain a central pillar in the ongoing U.S. economic recovery.
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