Daijiworld Media Network - Washington

Washington, Dec 13: The US trade deficit has fallen to its lowest point since mid-2020, shrinking by over 35 per cent compared to last year, according to a White House statement that hailed the development as a major success of President Donald Trump’s tariff-led trade policy.

The administration said the latest figures point to a significant turnaround in America’s trade position, driven by rising exports, declining imports, and a substantial reduction in the trade imbalance with China. Officials described the trend as proof that the President’s “America First” approach is reversing what they characterize as years of disadvantageous trade arrangements for US businesses.

According to the release, exports climbed 6 per cent year-on-year, reaching the second-highest level ever recorded. Inflation-adjusted consumer goods exports hit a record high, a sign, the administration said, of strengthening international demand for US-made products.

Trade with China showed notable improvement as well. The seasonally adjusted deficit with Beijing narrowed to its second-lowest level since 2009, aligning with the administration’s long-standing goal of rebalancing economic ties with China through tariffs and tougher negotiations.

The trade shift also supported broader economic growth. In the third quarter of 2025, real exports expanded at an annualized rate of 4.1 per cent, while imports declined by roughly 5 per cent. Together, these movements contributed about one percentage point to real GDP growth, the statement said.

The White House highlighted November’s data, noting that the monthly trade deficit was reduced by more than 50 per cent from a year earlier. It attributed the improvement partly to increased tariff revenues, arguing that the combination of higher exports, lower imports, and stronger collections is benefiting American workers, farmers, and manufacturers.

Officials framed the results as a break from decades of what they called ineffective trade policies that allowed foreign producers easier access to US markets while limiting opportunities for American exporters. They said the current administration has used tariffs as leverage to push trading partners toward fairer terms.

Since unveiling what it described as a landmark trade agenda in April, the administration claims the United States has gained unprecedented negotiating power, leading to new or revised trade agreements covering more than half of global GDP. These deals involve major economies such as the UK, EU, Japan, China, and South Korea, along with a wide range of emerging and smaller markets across Asia, Latin America, and Europe.

Beyond trade balances, the White House linked the tariff strategy to a surge in domestic investment. It said companies have announced trillions of dollars in new spending as manufacturing and jobs are brought back to the US, generating tens of thousands of new employment opportunities.

The administration argued that these investments are strengthening America’s position in future industries and demonstrating how trade policy can be used as a tool for economic and job growth.

While supporters view tariffs as a way to protect domestic industries and secure better trade terms, critics warn they can raise costs and provoke retaliation. Nevertheless, under President Trump’s second term, tariffs remain a central pillar of US trade policy, reshaping the country’s engagement with the global economy.