US trade deficit rises to US$679 billion, highest in 12 years

WASHINGTON: The US trade deficit rose 17.7 per cent last year to US$679 billion, highest since 2008, as COVID-19 disrupted global commerce and confounded President Donald Trump's attempts to rebalance America's trade with the rest of the world.

The gap between the value of the goods and services the United States sells abroad and what it buys climbed from US$577 billion in 2019, the Commerce Department said Friday. Exports skidded 15.7 per cent to US$2.1 trillion, and imports fell 9.5 per cent to US$2.8 trillion.

As president, Trump sought to narrow the gap by imposing taxes on imported goods on a scale unseen since the trade wars of the 1930s. The deficit narrowed slightly in 2019 but then ballooned last year as coronavirus restrictions hammered US exports of services such as tourism and education. Services exports dropped 20.4 per cent last year.

Still, the US ran a US$237 billion surplus last year in services. But that was overwhelmed by a US$916 billion deficit in trade in goods such as aircraft and auto parts.

The politically sensitive deficit with China in the sale of goods fell 10 per cent last year to US$311 billion; Trump had imposed tariffs on US$360 billion worth of Chinese imports to protest Beijing's sharp-elbowed efforts to supplant Western dominance in technology, an effort that US. alleged included cybertheft.

In the December, the trade deficit dropped to US$66.6 billion, down 3.5 per cent from November. Exports rose 3.4 per cent, and imports increased 1.5 per cent.