America's trade : markets count more than deficits

Abstract

U.S. trade deficits with Japan and other countries have led many to believe that Asia is the source of America's trade problems and that Latin America is the "natural market" for the United States. In fact, the worldwide U.S. trade deficit has declined sharply, and the country's best markets are in East Asia. Japan spends $50 billion on U.S. products, two-thirds of them manufactured goods, and U.S. sales are booming almost everywhere else in Asia. Though Mexico is a rapidly growing market, U.S. exports to the rest of Latin America in 1992 were $35 billion less than U.S. sales to just Korea, Taiwan and Singapore. America's misplaced anxiety about Asia, and over-emphasis on Latin America, could relegate the United States increasingly to the Western Hemisphere. This in turn could lead to the hardening of the world into three blocs in Europe, the Americas and Asia each organized around a powerful industrial economic base and each suspicious of the other.