Positive Trends on Trade?

When looking at monthly trade data, it is not the trade balance that matters. Instead, it's the trend on both exports and imports.

Namely, if both are growing, that's good news for the economy. Rising exports means expanding opportunities for U.S. enterprises and workers. Meanwhile, increasing imports is not an economic negative; instead, import growth generally reflects a growing domestic economy.

The latest trade data released from the U.S. Bureau of Economic Analysis on March 9 shows positives in terms of both exports and imports.

Exports rose in January, and that made for the second consecutive month of growth after two months of declines.

As for imports, they also rose in January for the third straight increase after a roller-coaster up and down ride for nine months.

Many uncertainties remain on the trade front, including European economic woes, questions swirling around the Middle East, the possibility of slower growth in China, and a lack of vision and leadership on free trade from the Obama administration.

The hope is that the recent months of growth in trade will develnp into a substantive trend. That would be good news for the small businesses that account for more than 97 percent of U.S. exporters. Of course, it would help a great deal if the U.S. would get back to a serious effort at reducing governmental obstacles to trade, so that opportunities can expand.


Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council. His new book is "Chuck" vs. the Business World: Business Tips on TV.