The U.S. has strengthened relations with other countries around the world by offering foreign aid. In 2017, the top five U.S. trading partners all received foreign aid from the U.S., the world’s largest trading nation.
In 2013, U.S. exports in goods and services were $2.3 trillion. Trade is vital to the U.S. economy as it provides growth, aids jobs and offers Americans affordable goods and services. It supports families and businesses by allowing more productive and higher paying jobs, growing the variety of products available for purchase and encouraging investment for a more rapid economic growth.
The top five U.S. trading partners of 2017 received foreign aid, and then returned the favor by assisting the U.S. economy.
Aid received from the U.S. in 2017: $16 million.
China is the United States’ top trading partner with 130,000 exports and 505,000 imports in 2017. In 2015, Chinese manufacturing lowered prices in the U.S. for consumer goods which lowered inflation and in turn gave more money to Americans; as a result, consumer prices were 1 to 1.5 percent lower.
Though the percentage seems small, such actions make a significant impact throughout time. In 2015, the average income for a household was $56,500; trade with China saved these families up to $850 each in that year alone.
Canada and Mexico
Aid received from the U.S. in 2017: $28 million and $61 million.
Canada, Mexico and the United States are members of the North America Free Trade Agreement (NAFTA). Between 1993 and 2017, trade between the three countries quadrupled from $297 billion to $1.17 trillion. Specifically, the U.S. increased its exports of goods to Canada and Mexico from $142 billion to $525 billion.
NAFTA aids economic growth, profits and jobs for all three countries in its agreement.
Aid received from the U.S. in 2017: $30,000.
Japan benefits the U.S. by providing 710,000 American jobs via exports, and their benefits continue to grow as well. Japanese students that study abroad in the U.S. contribute at least $600 each to the U.S. economy; Japan also ranks fourth of countries to contribute to American tourism. In 2014, there were more than 9.4 million Japanese visitors who spent $17 billion in the U.S.
Aid received from the U.S. in 2017: $15,000.
Germany is the largest consumer market in the European Union (EU), and due to its success, the U.S. benefits from Germany through exports. Although U.S. investors may have to pay a higher cost while doing business in Germany, they can count on high levels of productivity, a highly skilled labor force, quality engineering, a first-class infrastructure and a prime location in the center of Europe. Germany also helps the U.S. through spreading their businesses overseas — companies such as BMW, Daimler, Siemens and Volkswagen have expanded operations in the U.S. which has resulted in more jobs.
Foreign aid is an important aspect of world operations because it strengthens economies and improves other countries’ ability to grow and build relations. The top five U.S. trading partners demonstrate the direct benefits that foreign aid can bring back to American soil.
– Anne-Marie Maher