Although United States is the world’s number two exporter with global shipments valued over 3 times higher than those for tenth-place United Kingdom, that doesn’t mean that the UK is devoid of competitive advantages doing business with its bigger international trade rival.
Sure, the US maintains many profitable relationships encompassing a wide range of goods that it ships to its UK customers. Less well-known is the fact that nevertheless the UK enjoys significant trade product strengths that result in counterbalancing positive cashflows from America, albeit from a smaller set of products.
US Top 10
American Product Advantages Versus United Kingdom
Below are the top 10 goods for which United States enjoyed a higher dollar value from its exports to United Kingdom after subtracting what it spent on UK imports for those same types of products. Technically, a country’s exports minus imports is known as “net exports” which can be a positive amount (indicating a surplus) or a negative number (indicating a deficit).
- Gold (unwrought): US$3.3 billion surplus win for USA
- Hand-drawn paintings, drawings: $1.3 billion
- Coal, solid fuels made from coal: $745.5 million
- Computers, optical readers: $697.3 million
- Phone system devices: $606.2 million
- Precious metal waste, scrap: $590.2 million
- Jewelry: $515.7 million
- Petroleum gases: $393.5 million
- Fuel wood, wood chips, sawdust: $385.8 million
- Diamonds (unmounted/unset): $364.8 million
Among these, petroleum gases (up 5,647%) and fuel wood, wood chips and sawdust (up 251.6%) increased their net revenues for the United States from export sales to the United Kingdom by the highest percentages from 2012 to 2014.
UK Top 10
UK Product Advantages Versus United States
Refined oil represent the number one export for which the United Kingdom shows the strongest sales advantage compared to similar product exports from the US to the UK. In second place are automobiles, representing more sophisticated transportation commodities that benefit from strong demand from American consumers.
- Processed petroleum oils: US$4 billion surplus win for UK
- Cars: $3.4 billion
- Turbo-jets: $2.5 billion
- Alcohol (including spirits, liqueurs): $1.6 billion
- Medication mixes in dosage: $1.1 billion
- Aircraft parts: $991.3 million
- Miscellaneous heterocyclics: $885 million
- Seats (excluding barber/dentist chairs): $557.9 million
- Trucks: $541.6 million
- Heavy machinery (bulldozers, excavators, road rollers): $466.8 million
The fastest-growing UK product win versus the US is medication mixes in dosage posting a 281.3% gain in net exports from 2012 to 2014.
UK’s edge over American exports of chairs improved in value by 56.3% over the same period.
The Winner Is
Final Scorecard for Trade War: United States Versus United Kingdom
UK earned an overall $490.8 million surplus in its international trade with America during 2014.
From a more granular perspective, the Harmonized Tariff Schedule has 97 product categories at the two-digit summary level. The US held positive balances in 59 of those 97 categories (60.8%) for a $19.3 billion subtotal, led by the following:
- Aircraft, spacecraft: $7.7 billion surplus win for USA
- Gems, precious metals: $4.6 billion
- Collector items, art, antiques: $1.3 billion
- Electronic equipment: $1.1 billion
- Wood: $639.2 million
- Plastics, plastic articles: $370.5 million
- Books, newspapers, pictures: $321.6 million
- Fruits, nuts: $289.3 million
- Other base metals: $227.9 million
- Perfumes, cosmetics: $225.2 million
These 10 product categories account for 85.9% of the total value of American product-specific surpluses trading with the UK.
On the other hand, the United Kingdom dominated the remaining 38 product categories subtotaling $19.8 billion in surplus, led by the following:
- Vehicles : $3.9 billion surplus win for UK
- Mineral fuels including oil: $3.3 billion
- Machinery: $2.8 billion
- Beverages, spirits, vinegar:$1.5 billion
- Organic chemicals: $1.4 billion
- Pharmaceuticals: $1.2 billion
- Iron, steel: $1.1 billion
- Furniture, lighting , signs: $498.7 million
- Optical, technical, medical apparatus: $348.3 million
- Inorganic chemicals: $244.6 million
The above categories represent 82.5% of the total value of UK product-specific trade surpluses gained at United States’s expense.
See also United Kingdom’s Top 10 Exports, Highest Value UK Export Products, US Major Product Supply Advantages and America’s Top Import Partners
Research Sources:
The World Factbook, Country Profiles, Central Intelligence Agency. Accessed on January 17, 2016
International Trade Centre, Trade Map. Accessed on January 17, 2016
Investopedia, Net Exports Definition. Accessed on January 17, 2016