U.S Trade: How U.S Imports Have Shifted Since 1989

Since 1989, the leading U.S. trade partner, based on the share of imports, has undergone four changes. Likewise, the top 10 importers have experienced shifts, with some countries gaining market share and surpassing rivals due to favorable trade policies and economic conditions. Today, we’re focusing on seven countries, highlighting their changing roles as major sources of U.S. trade, utilizing data from the U.S. Census Bureau.

Canada and Mexico, as the closest land neighbors to the U.S., have consistently ranked among the nation's largest trade partners. The North American Free Trade Agreement (NAFTA), effective in 1994 (now replaced by the USMCA), facilitated the free movement of goods among the three countries due to their geographic proximity.

🇲🇽🇨🇦 Mexico & Canada: Strategic Partnership 🤝

Mexico, in particular, has greatly benefited from NAFTA, becoming the primary source of agricultural products for both the U.S. and Canada.

By 2022, it surpassed China, emerging as the largest source of foreign goods and services for the U.S. after the EU, accounting for 15.2% of the import share.

Together, Canada and Mexico contribute to one-third of all U.S. inbound trade.

🇨🇳 China:

China's rapid export rise in the 2000s defined it as the world's manufacturer. Between 2001–2022, Chinese exports to the U.S. grew nearly 1,000% to $600 billion. In 2017, China was the source of more than one-fifth of all U.S. imports. However, the U.S.-China trade war initiated by the Trump administration reduced China's share in U.S. inbound trade to 13.2% in 2023, as economies in South and Southeast Asia became manufacturing hotspots.

🇯🇵 Japan:

Japan, once the largest source of U.S. inbound trade during its post-war economic boom, saw a decline in its share as the economy stagnated in the mid-1990s. The signing of NAFTA further impacted Japan's position, with its share dropping to 4.6% in 2023.

Emerging Partnerships:

🇻🇳 Vietnam:

Vietnam has significantly benefited from the shift away from China, prioritizing education to develop a skilled workforce. As a result, Vietnam has risen to the seventh position among the top sources of U.S. imports in 2023, contrasting its lack of trade relations with the U.S. in 1989, a policy remnant from the Vietnam War.

🇮🇳 India:

India has found a niche as a source for gold and jewelry for the United States, and with rumors of American companies shifting manufacturing to the fifth-largest economy in the world, their share in U.S. imports may increase further.

🇹🇼 Taiwan:

Meanwhile, Taiwan, prioritizing an export-oriented economy since the 1950s, has been losing share in the U.S., its largest export market in 1990. The rise of China, along with Vietnam, Indonesia, and Thailand, has altered the Taiwanese export sector, shipping semi-finished goods to its neighbors, from where they eventually make their way to the United States.

Courtesy: Visual Capitalist