South By North Strategies, Ltd.

From the Economic Policy Institute’s analysis of national trade data for 2009:

The U.S. Census Bureau reported recently that the U.S. goods and services trade deficit fell from $695.9 billion in 2008 to $380.7 billion in 2009, a decline of $315.3 billion (45.3%). The historic collapse in global trade reflects the effects of the recession and financial crisis on both the demand for goods and services, and the impact of widespread shortages of loans needed to finance trade.

Despite the drop in the trade deficit in 2009, more of the gap is related to the country’s increasingly lopsided trade relationship with China. Last year, China accounted for 80 percent of the United States’ trade deficit in on non-oil goods. Notes the report:

China has captured a growing share of U.S. and world markets for manufactured products through a wide array of unfair trade practices including currency manipulation, export subsidies, widespread suppression of worker rights and wages, and tariff and non-tariff barriers to exports. It has purchased massive volumes of foreign exchange over the past decade in order to suppress the value of its currency. China’s total foreign exchange reserves increased $453 billion to a total of $2.4 trillion in 2009. China took advantage of the rest of the world during the financial crisis by increasing its share of U.S. markets for manufactured products.