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C. TODAY
The world is charging ahead in pursuit of new U.S. factories exports, but just one in every 20
market-opening trade agreements, and the vast providers of business services does so. Just 3% of
and often overlooked world of trade in services is U.S. services output is exported, according to the
drawing new attention. Peterson Institute for International Economics.
The world is charging ahead in pursuit of new market- To capitalize on America’s strength in services, U.S.
opening trade agreements, as explained earlier in this trade agreements have long tackled foreign barriers
series, but in recent years Washington policymakers to American services exports — just as they do for
have been sitting on trade policy’s sidelines. The manufactured goods and agricultural products.
United States derives huge benefits from trade and
trade agreements, but a bolder, forward-leaning U.S. trade pacts include services provisions to
approach is needed to ensure U.S. competitiveness in secure access to foreign services markets and bar
the decades ahead. discrimination against U.S. services industries. In
addition, they lift foreign governments’ limits on
In this context, the vast and often overlooked world of U.S. investments in their services sectors.
trade in services is drawing new attention. Consider:
As for the results, consider these highlights from
• Services rule. Services dominate the U.S. economy. the U.S. Department of Commerce:
Broadly speaking, services provide about 80% of all
American jobs (approximately 126 million of 158 • Under NAFTA (which was replaced by USMCA in
million American jobs in 2021, according to data from 2020), U.S. services exports to Canada and Mexico
the Bureau of Labor Statistics). have tripled, rising from $27 billion in 1993 to $101
Why Services Arebillion in 2019. Services imports from Canada and
Mexico have grown from $17 billion to
$69 billion.
the New Frontier • Under the U.S.-Singapore Free
Trade Agreement (FTA), U.S. services
exports to Singapore have nearly
quadrupled, increasing from $5.9
billion in 2003 to $23.3 billion
in Trade? By John G. Murphy, Senior Vice in 2019. Services imports from
President for International Policy, Singapore have grown from $2.1
U.S. Chamber of Commerce billion to $11.2 billion.
• More jobs, higher pay. Professional and business • Under the U.S.-Chile FTA, U.S. services
services employ 22.5 million Americans, making this exports to Chile have quintupled, increasing
sector a larger employer than manufacturing (75% from $1 billion in 2003 to $5.6 billion in 2019.
larger, in fact). What’s more, these are good jobs: Services imports from Chile have grown from
Wages in these fields are 25% higher on average than $622 million to $3.2 billion.
those in manufacturing (average hourly earnings of
$39 versus $31). • Under the U.S.-Australia FTA, U.S. services exports
to Australia have tripled, increasing from $6.9 billion
• Increasingly tradeable. Thanks in part to digital in 2004 to $21.9 billion in 2019. Services imports from
trade, about two-thirds of all services can be exported Australia have grown from $3.9 billion to $8.7 billion.
today, particularly in professional and business
services such as audiovisual, software, architecture, • Under the U.S.-South Korea FTA, U.S. services
accounting, engineering and project management, exports to South Korea have grown by 40%,
banking, insurance, and advertising. increasing from $16.7 billion in 2011 to $23.5
billion in 2019. Services imports from South Korea
• Competitive advantage. As the world’s largest have grown from $9.7 billion to $11 billion.
exporter of services, it is in the interest of the United
States to focus on services trade. U.S. services exports As noted, digitalization is unleashing new potential
reached nearly $800 billion in 2021. In addition, in services trade, which in the past decade has
services sales by foreign affiliates of U.S. multinational been growing about twice as fast globally as trade
companies reached $1.65 trillion. in goods.
• Untapped potential. Despite these big numbers, The U.S. Chamber of Commerce examined this
the potential for service industries to engage in trend in a major report entitled The Digital Trade
international trade is almost untapped. One in four Revolution: How U.S. Workers and Companies
15 AMCHAM SOUTH CHINA
The world is charging ahead in pursuit of new U.S. factories exports, but just one in every 20
market-opening trade agreements, and the vast providers of business services does so. Just 3% of
and often overlooked world of trade in services is U.S. services output is exported, according to the
drawing new attention. Peterson Institute for International Economics.
The world is charging ahead in pursuit of new market- To capitalize on America’s strength in services, U.S.
opening trade agreements, as explained earlier in this trade agreements have long tackled foreign barriers
series, but in recent years Washington policymakers to American services exports — just as they do for
have been sitting on trade policy’s sidelines. The manufactured goods and agricultural products.
United States derives huge benefits from trade and
trade agreements, but a bolder, forward-leaning U.S. trade pacts include services provisions to
approach is needed to ensure U.S. competitiveness in secure access to foreign services markets and bar
the decades ahead. discrimination against U.S. services industries. In
addition, they lift foreign governments’ limits on
In this context, the vast and often overlooked world of U.S. investments in their services sectors.
trade in services is drawing new attention. Consider:
As for the results, consider these highlights from
• Services rule. Services dominate the U.S. economy. the U.S. Department of Commerce:
Broadly speaking, services provide about 80% of all
American jobs (approximately 126 million of 158 • Under NAFTA (which was replaced by USMCA in
million American jobs in 2021, according to data from 2020), U.S. services exports to Canada and Mexico
the Bureau of Labor Statistics). have tripled, rising from $27 billion in 1993 to $101
Why Services Arebillion in 2019. Services imports from Canada and
Mexico have grown from $17 billion to
$69 billion.
the New Frontier • Under the U.S.-Singapore Free
Trade Agreement (FTA), U.S. services
exports to Singapore have nearly
quadrupled, increasing from $5.9
billion in 2003 to $23.3 billion
in Trade? By John G. Murphy, Senior Vice in 2019. Services imports from
President for International Policy, Singapore have grown from $2.1
U.S. Chamber of Commerce billion to $11.2 billion.
• More jobs, higher pay. Professional and business • Under the U.S.-Chile FTA, U.S. services
services employ 22.5 million Americans, making this exports to Chile have quintupled, increasing
sector a larger employer than manufacturing (75% from $1 billion in 2003 to $5.6 billion in 2019.
larger, in fact). What’s more, these are good jobs: Services imports from Chile have grown from
Wages in these fields are 25% higher on average than $622 million to $3.2 billion.
those in manufacturing (average hourly earnings of
$39 versus $31). • Under the U.S.-Australia FTA, U.S. services exports
to Australia have tripled, increasing from $6.9 billion
• Increasingly tradeable. Thanks in part to digital in 2004 to $21.9 billion in 2019. Services imports from
trade, about two-thirds of all services can be exported Australia have grown from $3.9 billion to $8.7 billion.
today, particularly in professional and business
services such as audiovisual, software, architecture, • Under the U.S.-South Korea FTA, U.S. services
accounting, engineering and project management, exports to South Korea have grown by 40%,
banking, insurance, and advertising. increasing from $16.7 billion in 2011 to $23.5
billion in 2019. Services imports from South Korea
• Competitive advantage. As the world’s largest have grown from $9.7 billion to $11 billion.
exporter of services, it is in the interest of the United
States to focus on services trade. U.S. services exports As noted, digitalization is unleashing new potential
reached nearly $800 billion in 2021. In addition, in services trade, which in the past decade has
services sales by foreign affiliates of U.S. multinational been growing about twice as fast globally as trade
companies reached $1.65 trillion. in goods.
• Untapped potential. Despite these big numbers, The U.S. Chamber of Commerce examined this
the potential for service industries to engage in trend in a major report entitled The Digital Trade
international trade is almost untapped. One in four Revolution: How U.S. Workers and Companies
15 AMCHAM SOUTH CHINA
