Commentary: Don’t forget the exports
Given the recent apocalyptic descriptions of the U.S. financial crisis
By Andy Bateman
Given the recent apocalyptic descriptions of the U.S. financial crisis,
one might think the end is indeed nigh with terms such as “turmoil”,
“meltdown”, “cataclysm” “19/9” and “disaster” in daily use across all
Given the recent apocalyptic descriptions of the U.S. financial crisis, one might think the end is indeed nigh with terms such as “turmoil”, “meltdown”, “cataclysm” “19/9” and “disaster” in daily use across all media. The fallout from the credit squeeze and thousands of individual family mortgage defaults is certainly staggering, never mind the dramatic downturn in the fortunes of U.S. financial icons such as Fannie Mae, Freddie Mac, American International Group (AIG), Lehman Brothers, Merrill Lynch and others. The turmoil over the vast public bailout of the financial system by the U.S. Treasury Department with the purchase of hundreds of billions of dollars worth of bad mortgages is also without precedent.
Against this background, now seems as good a time as any for some words of encouragement to any U.S. lenders and manufacturers who might, quite understandably, be preoccupied with the domestic scene. The market economy is still functioning. Your biggest international trading partner is alive and well. Export markets may provide opportunities that are, at least for the time being, unavailable in a troubled domestic market.
Data released by the Milwaukee, Wisconsin based Association of Equipment Manufacturers (AEM) confirms that Canada’s construction industry is doing its bit for U.S. manufacturers and also reinforces the importance of the Canadian market to U.S. exporters of construction machinery. Canada alone purchased $3.35 billion of U.S. made construction equipment during the first half of 2008, or nearly the same figure as the combined total of all the remaining countries in the Top 10.
Comparison with individual countries and world regions is equally illuminating.
Canada’s $3.35 billion total was four times more than second placed Australia ($824 million) and six times more than third placed Mexico ($544.5 million). At the same time, Canada bought more than twice as much U.S. built construction equipment as the whole of Europe ($1.6 billion) and nearly fifteen times as much as China ($224 million).
AEM Senior Vice President Al Cervero summarises things well: “Exports remain a bright spot for the U.S. construction equipment manufacturing industry in these uncertain times, and whoever is elected President in November needs to focus on passage of free and fair trade agreements that eliminate barriers to commerce across borders.”