« Globalization agenda | Main | Banking on an intangible »
July 11, 2008
May trade in intangibles
The BEA's trade data carried some good news this morning: the deficit declined slightly in May by $0.7 billion to $59.8 billion (compared to the revised figure of $60.5 billion for April). The improvement was due to exports growing faster than imports, as imports of oil actually declined. Exports were up $1.4
The exact same story held true for intangibles: the surplus increased slightly as export rose faster than imports. The intangibles trade surplus rose by $203 million to $13.2 billion. Intangible exports rose by $335 million while imports rose by $131 million. This pattern of export increasing faster than import existed for both royalties and business services.
The deficit in Advanced Technology Products also declined in May to $3.5 billion. This is more in keeping with the size of the deficit in earlier months rather than April's much larger deficit of $5.3 billion. The improvement was generally across the board, except for opto-electronics showing a worsening deficit. The last monthly surplus in Advanced Technology Products was in June 2002 and the last sustained series of monthly surpluses were in the first half of 2001.
Note: we define trade in intangibles as the sum of "royalties and license fees" and "other private services". The BEA/Census Bureau definitions of those categories are as follows:
Royalties and License Fees - Transactions with foreign residents involving intangible assets and proprietary rights, such as the use of patents, techniques, processes, formulas, designs, know-how, trademarks, copyrights, franchises, and manufacturing rights. The term "royalties" generally refers to payments for the utilization of copyrights or trademarks, and the term "license fees" generally refers to payments for the use of patents or industrial processes.
Other Private Services - Transactions with affiliated foreigners, for which no identification by type is available, and of transactions with unaffiliated foreigners. (The term "affiliated" refers to a direct investment relationship, which exists when a U.S. person has ownership or control, directly or indirectly, of 10 percent or more of a foreign business enterprise's voting securities or the equivalent, or when a foreign person has a similar interest in a U.S. enterprise.) Transactions with unaffiliated foreigners consist of education services; financial services (includes commissions and other transactions fees associated with the purchase and sale of securities and noninterest income of banks, and excludes investment income); insurance services; telecommunications services (includes transmission services and value-added services); and business, professional, and technical services. Included in the last group are advertising services; computer and data processing services; database and other information services; research, development, and testing services; management, consulting, and public relations services; legal services; construction, engineering, architectural, and mining services; industrial engineering services; installation, maintenance, and repair of equipment; and other services, including medical services and film and tape rentals.
Posted by Ken Jarboe at July 11, 2008 09:33 AM
Trackback Pings
TrackBack URL for this entry:
http://www.athenaalliance.org/mt/mt-tb.cgi/2025