Net Importer

A net importer is a country or territory whose value of imported goods and services is higher than its exported goods and services over a given period of time. A net importer, by definition, runs a current account deficit in the aggregate; however, it may run deficits or surpluses with individual countries or territories depending on the types of goods and services traded, competitiveness of these goods and services, exchange rates, levels of government spending, trade barriers, etc.

As categorized by the U.S. Commerce Department, traded goods include food and beverage, industrial supplies (inclusive of commodities), capital goods, automobiles and consumer goods, while main services comprise travel (goods and services acquired abroad), transportation, information technology and telecommunication, financial and insurance services, and general business services. The Commerce Department keeps monthly tallies on exports and imports in numerous table displays.

The United States, a consumer colossus, has been a net importer for decades. Even though this country excels in a number of leading export goods and services — passenger planes, factory equipment, luxury automobiles, soybeans, Hollywood movies, banking services, to name several — Americans love to buy things, and countries around the world are happy to feed the beast. Being a net importer is not necessarily a bad thing, but running a chronic and growing trade deficit over time creates a host of issues. In 2017, imports exceeded exports by $566 billion, according to Commerce Department data. In the trailing 10-year period ending 2017, the average trade deficit was $520 billion per year. The major problem with these substantial trade deficits is that they must be financed to maintain the balance of payments account. The principal means of financing the current account deficit is borrowing from other countries. Continuous sales of Treasury bonds to major trading partners from which the U.S. is a net importer has created a measure of dependency on these creditors, which, some say, has the potential to lead to political or economic danger down the road.