A top Obama administration official said Wednesday that new trade agreements are needed to jump-start U.S. exports.
Commerce Secretary Penny Pritzker said that despite a decline in the U.S. trade deficit in March, “exporters continue to battle economic headwinds that have hindered trade across the globe.”
{mosads}”That is why President Obama and our entire administration continue to push for 21st century trade agreements like the Trans-Pacific Partnership, which will ensure that U.S. businesses have greater access to even more fast-growing foreign markets around the world and can compete fairly against foreign competition,” she said.
The trade gap narrowed to $40.4 billion last month, a drop of 13.9 percent from February, the smallest shortfall since February 2015, when the deficit was $39 billion, the Commerce Department reported on Wednesday.
But most of the drop was caused by a sharp decline in imports, which fell 3.6 percent to $217.1 billion — the biggest drop since February 2009.
Exports on the other hand decreased 0.9 percent to $176.6 billion.
Pritzker said it is critical that the TPP “enters into force as quickly as possible so that U.S. exports can continue to drive economic growth and job creation around the country.”
She expressed optimism that Congress can get the TPP done despite it obvious rocky path ahead.
Congressional leaders have expressed a desire to consider the TPP this year, most likely after the November elections, if at all before Obama leaves office.
Top Republicans are seeking changes from the White House to the sweeping Asia-Pacific agreement before they will consider the TPP.
Meanwhile, trade talk has dominated the Republican and Democratic presidential campaigns with none of the remaining three candidates — Donald Trump, Hillary Clinton and Bernie Sanders — backing the president’s trade agenda.
So even though the trade numbers looked better for March, they most likely reflected the economy’s slow start to the year.
Moody’s Analytics said in an analysis that March’s significant decline is not as positive as it first appears.
The decline in imports portend falling U.S. consumer spending. But it may also mean that businesses are making adjustments to their inventories to better align them with sales.
Overall, the trade deficit through the first three months of the year is running slightly behind 2015 levels.
In March, the trade gap with China fell $6.2 billion to $26 billion, which is still easily the largest with any country in the world. Exports increased $0.1 billion to $8.5 billion and imports decreased $6.1 billion to $34.4 billion.
Trump and Sanders have each blasted China’s for unfair trade practices they say are hurting the U.S. economy and costing jobs.
America’s deficit with the European Union was $11.1 billion, the shortfall with Mexico was $5.2 billion and the deficit with Japan was $5.9 billion.