U.S. business leaders expect export volumes to rise in the second half of 2013, as global economic conditions improve and demand for infrastructure goods rises, according to a survey by HSBC North America.
HSBC said its trade confidence index, based on a survey of small and middle-market businesses from May through June, rose to a record 114, up from 107 six months earlier. Sixty-seven percent of those surveyed expected export and import volumes to rise in the latter half of the year, a jump of 48 percent compared with the second half of 2012. In the longer term, the average growth of U.S. trade is predicted to increase 6 percent annually through 2030.
Top growth sectors for U.S. exports in both the near term and long term are expected to include industrial machinery and transport equipment for infrastructure needs. Over the next three years, those materials will account for 35 percent of the growth in U.S. exports, HSBC said. Notably, total global trade linked to infrastructure is predicted to triple by 2030, driven by emerging countries, including China and India.
In terms of total U.S. exports, 20 percent of those surveyed saw Latin America as the most promising region for near-term growth, followed by China with 13 percent. However, in the long run, China is expected to beat out Latin America as the most promising region. More specifically, U.S. ocean container exports to China are expected to increase by 4.3 percent in 2013, 5.2 percent in 2014 and 6.4 percent in 2015, according to JOC Economist Mario Moreno, and overall U.S. exports to China are predicted to more than double over the next 30 years, from 7 percent today to 18 percent in 2040. Canada and Mexico will also remain important markets for U.S. exports, accounting for 17 percent and 14 percent respectively in 2030.
In contrast, Europe’s market importance will decline over the next three decades, with the region’s share dropping to 13 percent in 2030 from 20 percent in 2012.
“The U.S. has good access to a wide range of export markets because of its geographical position, openness to trade and competitiveness, especially in transport equipment and industrial machinery,” said Prabhat Vira, regional head of global trade and receivables finance in North America for HSBC, in a written statement. “Rising middle classes across Asia’s rapidly emerging markets will drive significant infrastructure demand in the region. And as China looks to scale the value chain in terms of the goods it manufactures, there is a strong opportunity for developed economies like the U.S. to supply sophisticated investment equipment to the country’s producers.”