The calculation of the US trade deficit has not taken into account profit returns and intellectual exports which are highly profitable but usually not counted by customs a Chinese statistician said Sunday.
If calculated accurately, the profits from surging outward investments, technology exports, patent rights, cultural products and many other intangible goods would reduce the deficit, Li Deshui, ex-director of the National Bureau of Statistics, told Xinhua in an exclusive interview at the Boao Forum for Asia (BFA) 2006.
The United States had not suffered from a serious economic depression although it reported a trade deficit of US$804.9 billion in 2005, a huge jump from the US$39.1 billion in 1992, Li observed.
In Fact its overall economic growth stood at 3.6 percent last year--slightly higher than that of 1992--and the national unemployment rate dropped to 5.1 percent from 7.5 percent, according to Li.
The deficit failed to take account of the huge profits earned by overseas-based US firms, Li noted. He pointed out that goods shipped back to the US had been unreasonably considered imports.
Statistics from the United Nations show that overseas US companies realized a combined sales volume of US$3,383 billion in 2004 which is more than three times the exports from its home based firms.
A US official report released last March said US companies earned some US$315 billion from overseas markets in 2003, up 26 percent year-on-year, a large part of which had been transferred back home.
In addition to the huge profits the Chinese statistical expert also highlighted the booming service industries such as the export of financial consultancy expertise and the rocketing sales of US cultural products including technologies, patents and trademarks.
"It's impossible for the US customs to register the amount of money if China purchases a movie from the United States," Li explained.
Asian nations had invested in national bonds and other US assets which was yet another source of capital inflow that was not under estimated, he added.
According to the International Monetary Fund the US overall balance of payments deficit was US$1.5 billion and US$2.8 billion in 2003 and 2004, respectively.
Such a balanced situation could explain why the country had maintained rapid economic growth accompanied by a huge trade deficit, said Li.
The US trade deficit, along with some other global economic challenges like soaring oil prices, has been widely viewed as a threat which could undermine the world economy, he added.
(Xinhua News Agency April 24, 2006)