Trade
Introduction
Net trade with foreigners: exports less imports. A trade deficit means that exports are insufficient to pay for exports; a trade surplus, the opposite. Sometimes called "net exports", the trade balance is a component of GDP, to the effect that a perfectly equilibrated trade balance makes the GDP dependent only on domestic values.

A simultaneous increase of both imports and exports by the same amount leaves unaltered the trade balance. Any difference in dynamics between exports and imports has a multiplied effect on trade balance.

Trade balance is usually decomposed by product and by country (bilateral trade balances). Relevant is the degree of concentration of the imbalance in trade caused by one or few commodities. If concentration is high, a targeted industrial policy could improve the balance (e.g. reduce the imbalance). Trade balance is a component of GDP: other things equal, a surplus increases GDP and deficit reduces it. In particular, long-lasting trade deficit can lead to foreign debt, on which a country has to pay interests. If this debt is judged by market agents as unsustainable, a currency crises can erupt.

Trade imbalances are widespread throughout the world and persistent over time. In order to reduce the gap with rich countries, poor countries have to rise much faster than them, which are usually their main commercial partners

Commodities

% Export

Electrical machinery, including computers

14.80%

Mineral fuels, including oil, coal, gas, and refined products

14.40%

Nuclear reactors, boilers, and parts

14.20%

Cars, trucks, and buses

8.90%

Scientific and precision instruments

3.50%

Plastics

3.40%

Iron and steel

2.70%

Organic chemicals

2.60%

Pharmaceutical products

2.60%

Diamonds, pearls, and precious stones

1.90%

Others

31.00%

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