Slide 0Slide 1Top Ten 2000 U.S. Trading Partners ($ billions)U.S. Multinational in Europe - 1960’sSlide 4U.S. Current Account by Major Components, 1990-1999 ($ billions)Slide 6Buying Boom for Asia, 1995-2000Slide 8The Price of ProtectionismSlide 10Types of Non-tariff BarriersSlide 12Slide 14Slide 14Slide 15What WTO Means to Different IndustriesSlide 18Slide 18Slide 19The Dynamic Environment of International TradeChapter2Top Ten 2000 U.S. TradingPartners ($ billions)Canada $176.4 $229.2 $405.6 -$52.8Mexico 111.7 135.9 247.6 -24.2Japan 65.3 146.5 211.8 -81.3China 16.3 100.0 116.3 -83.8Germany 29.3 558.7 88.0 -29.5United Kingdom 41.5 43.5 85.0 -1.9South Korea 27.9 40.3 68.2 -12.4Taiwan 24.4 40.5 64.9 -16.1France 21.0 29.0 50.0 -8.0Singapore 17.4 19.6 37.0 -2.2Country U.S. Exports U.S. Imports Total Surplus/DeficitIrwin/McGraw-Hill2-2Copyright©2002 by The McGraw-Hill Companies, Inc. All rights reserved.U.S. Multinational in Europe - 1960’sFifteen years from now the world’s third greatest industrial power, just after the United States and Russia, may not be Europe, but American industry in Europe.J.S. Servan Schreiber:Le Defi American, 1967 What Happened?Irwin/McGraw-HillCopyright©2002 by The McGraw-Hill Companies, Inc. All rights reserve.2-34Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved. The Nationality of the World’s 100 Largest Industrial Corporations (by country of origin)United States 67 47 47 33 32 24 24 36Germany 13 13 8 12 14 14 13 12Britain 7 7 5 6 4 1 2 5France 4 11 5 10 6 12 13 11Japan 3 7 12 18 23 37 29 22Italy 2 3 3 4 4 3 4 3Netherlands-United Kingdom 2 2 2 2 2 2 2 --Netherlands 1 3 1 1 1 2 2 5 Switzerland 1 1 2 3 3 3 5 3Argentina -- -- 1 -- -- -- -- --Belgium -- 1 1 -- -- -- -- 1Brazil -- 1 -- 1 1 -- -- -- Canada -- 2 3 -- -- -- -- --India -- -- 1 -- -- -- -- --Kuwait -- -- 1 -- -- -- -- --Mexico -- 1 1 1 1 -- 1 --Venezuela -- 1 1 1 1 -- 1 --South Korea -- -- 4 2 4 2 4 --Sweden -- -- 1 2 1 -- -- --South Africa -- -- 1 1 -- -- -- --Spain -- -- -- 2 2 -- -- --Turkey -- -- -- -- 1 -- -- --China -- -- -- -- -- -- -- 2 1963 1979 1984 1990 1993 1995 1996 20002-4Irwin/McGraw-HillU.S. Current Account by Major Components, 1990-1999 ($ billions)Merchandise Tradea. Exports $201.8 $219.9 $215.9 $224.0 $246.6 $319.9 $362.1 $389.3 $416.9 $440.4 $456.9b. Imports 268.9 332.4 338.1 368.5 409.9 446.4 477.4 498.3 491.0 536.5 589.4c. Balance -67.1 -112.5 -122.2 -144.5 -160.3 -126.5 -115.2 -109.0 -74.1 -96.1 -132.5Business Servicesa. Exports 42.3 44.3 46.2 51.8 59.4 69.1 116.5 136.6 153.7 164.4 174.5b. Imports 35.8 42.3 47.2 51.0 58.0 63.2 86.9 98.7 101.6 104.4 112.7c. Balance +6.6 +2.0 -1.0 +0.8 +1.4 +5.9 +29.6 +37.9 +52.1 +60.0 +61.81983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993SOURCES: Survey of Current Business, U.S. Department of Commerce, Bureau of Economic Analysis. http://www.stat-usa.gov/BEN/heal/sch.html. Februarly 1998Irwin/McGraw-Hill2-51983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993U.S. Current Account by Major Components, 1983-96 ($ billions)International Investment Incomea. Receipts 77.3 85.9 88.8 90.1 103.8 108.2 152.5 160.3 136.9 114.4 113.9b. Payments 52.4 67.4 62.9 67.0 83.4 105.6 138.9 139.6 122.1 109.9 109.0c. Balance +24.9 +18.5 +25.9 +23.1 +20.4 +2.6 +13.6 +20.7 +14.8 +4.5 +4.0Total Goods and Servicesa. Exports 334.4 360.8 360.6 375.0 424.8 507.8 641.4 696.8 717.0 731.4 755.6b. Imports 371.2 455.6 460.7 498.6 565.3 629.6 718.2 754.9 730.7 767.3 827.3c. Balance -36.8 -94.8 -100.1 -123.6 -140.5 -121.8 -76.7 -58.1 -13.7 -35.9 -71.7Net unilateral transfers -9.5 -12.2 -15.0 -15.3 -13.4 -13.6 -26.1 -33.7 +6.7 -31.9 -32.0Current accountbalance -46.2 -107.0 -115.1 -138.9 -153.9 -135.4 -102.8 -91.8 -7.0 -67.8 -103.7 SOURCES: Survey of Current Business, U.S. Department of Commerce, Bureau of Economic Analysis. http://www.stat-usa.gov/BEN/heal/sch.html.February 1998.Irwin/McGraw-Hill2-6Buying Boom for Asia, 1995-2000Millions of households approaching $18,000 per year buying power Indexed to Singapore prices14.432.573.31991 1995 2000What the added Between 1993 andmiddle class will 1995 2000buy (In million) Bedrooms 32 116Living Rooms 16 58Kitchens 16 58Bathrooms 32 116Living space (sq.m.) 1,200 4,350Large appliances 16 58Televisions 24 87Telephones 24 87Cars 16 58SOURCE: Bill Saporito, “Where the Global Action Is.” Fortune, Autumn-Winter 1993, p.64.Irwin/McGraw-Hill2-7What Would One U.S. Dollar Buy? (Selected Years) 1985 1987 1988 1992 1993 1994 1995 1996 1997 1999 2000British Pound 0.86 0.67 0.54 0.56 0.66 0.68 0.63 0.64 0.59 0.62 0.68French Franc 9.6 7.55 5.4 5.29 5.67 5.55 4.95 5.12 5.94 6.49 7.28Japanese Yen 250.23 123.32 123.70 126.70 111.08 102.18 93.96 108.78 129.15 102.58 112.21Swiss Franc 2.25 2.07 1.29 1.41 1.48 1.37 1.18 1.24 1.43 1.58 1.68EURO 0.99 1.11 Mexico Peso 0.37 2.21 2.28 3.12 3.11 5.31 6.45 7.60 7.92 9.43 9.47Irwin/McGraw-Hill* Foreign Exchange Rates for 1999 and 2000 are the average rate pf exchange in December. Source: Adapted from www.stat-usa.gov2-8The Price of ProtectionismIndustry Total Costs to Number of Cost perConsumers Jobs Saved Job Saved(in $ millions)Textiles and apparel $27,000 640,000 $ 42,000Carbon Steel 6,800 9,000 $ 750,000Autos 5,800 55,000 $ 105,000Dairy products 5,500 25,000 $ 220,000Shipping 3,000 11,000 $