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Mexico’s state oil company Pemex (headquarters pictured above) has the most valuable brand in Latin America, according the latest ranking from Brand Finance. (Photo: Mexican Government).
Wednesday, February 21, 2018
Trade Talk

US-Mexico Trade Deficit Grew 12%


US-Latin America trade, economic freedom, most valuable brands.

BY LATINVEX STAFF

Despite US president Donald Trump’s threats to restrict trade with Mexico in order to reduce the US trade deficit with that country, it actually grew during his first year.

The deficit reached $71.1 billion last year, up 12.4 percent from the 2016 deficit, according to a Latinvex analysis of of US Census Bureau data. That was higher than the US deficit with Latin America overall, which grew 9.3 percent to $47.8 billion.

US exports to Mexico increased 5.2 percent to $243 billion, while imports from Mexico grew 6.8 percent to $314 billion. Total trade reached $557 billion, a 6.1 percent increase from 2016.

Total US trade with Latin America recovered last year from 2016 declines. Total trade grew 6.9 percent to $802.5 billion – in contrast to a 3.3 percent fall in 2016.

US exports increased 6.9 percent to $377.9 billion, marking a recovery from the 5.2 percent decline seen in 2016. Meanwhile, US imports from Latin America expanded by 6.9 percent to $424.6, significantly more than the 1.5 percent decrease in 2016.

US-Latin America Trade

2017 trade with top trade partners in millions of US dollars. Percent change over 2016.

Country

Exports

Ch

Imports

Ch

Total

Ch

Mexico

$242,988.70

5.20%

$314,045.20

6.80%

$557,033.90

6.10%

Brazil

$37,076.90

22.40%

$29,427.30

12.40%

$66,504.20

17.30%

Colombia

$13,272.40

1.30%

$13,556.00

-1.70%

$26,828.40

-0.20%

Chile

$13,608.40

5.20%

$10,551.60

19.90%

$24,160.00

11.10%

Venezuela

$4,169.40

-20.70%

$12,336.90

13.30%

$16,506.23

2.20%

Argentina

$9,513.00

6.10%

$4,765.40

2.50%

$14,278.49

4.90%

Total LatAm

$377,858.00

6.90%

$424,625.30

6.90%

$802,483.30

6.90%

Sources: US Census Bureau (exports, imports); Latinvex (percent change, total)

TEXAS OIL PRODUCERS SUPPORT NAFTA

Meanwhile, the Texas Alliance of Energy Producers have announced their support of the North American Free Trade Agreement (NAFTA) after President Donald Trump’s remarks at the World Economic Forum in Switzerland indicated that he may terminate the agreement and begin the negotiations anew.

“The North American Free Trade Agreement is an energy economics success story by virtually every measure,” Petroleum Economist Karr Ingham said in a statement. “It has contributed to growth and jobs in the Texas and US oil and gas industry, it is providing new markets for domestic energy production, and is lowering the costs to consumers in all three countries. Taken as a whole, North America is on the verge of achieving energy self-sufficiency – a longstanding goal that has enjoyed significant advancement under NAFTA.”

The Texas Alliance of Energy Producers represents more than 2,500 independent oil and gas producers in Texas.

In a report, the alliance pointed to the following key facts in favor of NAFTA: natural gas exports to Mexico have increased by well over five times (445%) since 2010, including an estimated 30% in 2017 alone; the U.S. became a net exporter of natural gas in North America  by year end 2017 due in large part to rapidly expanding natural gas exports to Mexico and exports of crude oil to Mexico have increased by some 320% since 2010.

 “NAFTA … has become a part of our daily oil business lives,” Alliance Chairman Bob Osborne said. “NAFTA is important to Texas, and if renegotiated, its impact on our markets for oil and gas needs to remain positive and profitable.”

ECONOMIC FREEDOM: ARGENTINA, MEXICO IMPROVE

The economies of Argentina and Mexico are among the few in Latin America that have become freer the past year, while those of Brazil, Chile, Colombia and Peru became less free, according to the 2018 Index of Economic Freedom from the Heritage Foundation.

The index looks at 12 different freedoms in 180 countries worldwide. The 12 are property rights, government integrity, judicial effectiveness, tax burden, government spending, fiscal health, business freedom, labor freedom, monetary freedom, trade freedom, investment freedom and financial freedom.

“The rule of law and regulatory efficiency are major problem areas, reflecting long-standing weakness in the protection of property rights, ineffectiveness in the judiciary, and lack of government integrity,” the Heritage Foundation said in a statement announcing the 2018 results.

Chile’s economy remains the freest in Latin America, but Uruguay replaced Colombia in the number two spot.

Meanwhile, Argentina and Mexico saw the strongest improvements in their score, while Bolivia suffered the worst decline, followed by Venezuela and Brazil.

For the second year in a row, Venezuela’s economy ranks as less free than that of Cuba, a nominally Communist country.

Venezuela also ranks as the second-worst economy worldwide, only better than North Korea, according to the Heritage Foundation.

 

Economic Freedom: Best & Worst in Latin America

LA

GL

Country

Score

Ch 17/16

Status

1

20

Chile

75.2

-1.3

Mostly Free

2

38

Uruguay

69.2

-0.5

Moderately Free

3

42

Colombia

68.9

-0.8

Moderately Free

4

43

Peru

68.7

-0.2

Moderately Free

5

54

Panama

67

0.7

Moderately Free

6

57

Costa Rica

65.6

0.6

Moderately Free

7

63

Mexico

64.8

1.2

Moderately Free

8

73

Guatemala

63.4

0.4

Moderately Free

9

75

El Salvador

63.2

-0.8

Moderately Free

10

82

Paraguay

62.1

-0.3

Moderately Free

11

89

Dom. Rep.

61.6

-1.3

Moderately Free

12

94

Honduras

60.6

1.8

Moderately Free

13

100

Nicaragua

58.9

-0.3

Mostly Unfree

14

144

Argentina

52.3

1.9

Mostly Unfree

15

153

Brazil

51.4

-1.5

Mostly Unfree

16

165

Ecuador

48.5

-0.8

Repressed

17

173

Bolivia

44.1

-3.6

Repressed

18

178

Cuba

31.9

-2

Repressed

19

179

Venezuela

25.2

-1.8

Repressed

Average

58

Mostly Unfree

LA: Latin America rank. GL=Global rank

Sources: Heritage Foundation, Latinvex (ranking by scores)

 

PEMEX MOST VALUABLE LATAM BRAND

Mexico’s state oil company Pemex has the most valuable brand in Latin America, according the latest ranking from Brand Finance, a London-based business valuation and strategy consultancy.

 “This year will be key in order to analyze how Pemex will manage its prominence in the local market as well as how it will extend its brand beyond Mexico’s borders,” Laurence Newell, Brand Finance head for Mexico and Latin America, said in a statement.

According to Brand Finance, the Pemex brand is now worth $8.4 billion, ehad of number two in Latin America – Brazilian bank Itau, with $8 billion and Mexican telecom giant Claro at $61. billion.

Other top brands include Brazilian bank Bradesco, Brazilian state oil giant Petrobras, Brazil’s state-owned bank Banco do Brasil and Colombian state oil company Ecopetrol.

 

 

© Copyright Latinvex 

 

 

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