Archive for October, 2012



U.S. Virgin Islands’ Economy Grew 2.9 Percent in 2010

The economy of the U.S. Virgin Islands returned to growth in 2010, expanding 2.9 percent, according to new data from the Bureau of Economic Analysis (BEA). The growth in real gross domestic product (GDP) largely reflected increases in the trade surplus, government spending, and construction.

GDP offers the most comprehensive picture of the territory’s economy. Although more timely indicators like employment, wages, and visitor arrivals are available, GDP looks at all aspects of the U.S. Virgin Islands’ economy, including prices, output, consumer spending, and trade.

For the first time, BEA calculated estimates of GDP by industry, compensation by industry, and detailed consumer spending for the territory. BEA also revised previous estimates for 2002 to 2009.

The 2.9 percent gain in 2010 followed a 5.9 percent decrease in 2009 and marked the first increase in economic activity since 2007. The island’s 2010 growth rate compares with 2.4 percent growth for the United States as a whole for the same period.

The oil refining industry continued to play a major role in the territory’s economy and accounted for the vast majority of imports and exports of goods. The territory’s expanded trade surplus contributed over 10 percentage points to overall GDP growth.

Imports declined more than exports, expanding the trade surplus. Exports add to GDP, while imports subtract from it. The increase in the trade surplus was partially offset by a decrease in private inventories, which subtracted 9 percentage points from overall GDP growth.

Real consumer spending in the U.S. Virgin Islands expanded 0.4 percent in 2010, driven largely by increases in health care services and “other” services, while spending on goods—especially durable goods—declined.

GDP by industry and compensation by industry
Taken together, private industries added 2.77 percentage points to overall growth in 2010, while government contributed 0.15 percentage point.

Services-producing industries were the primary source of overall growth in 2010. They contributed 3.52 percentage points to economic growth in 2010, the new estimates show. A decline in goods-producing industries largely reflected a decline in the oil refining industry.

The accommodations and amusement industry, including hotel and food services—along with other tourism-related services—continued to decline.

BEA plans to release estimates for 2011 in the spring of 2013. You can read the latest news release and tables here.

BEA Regional Data Used to Distribute Federal Funds to State, Local Governments

Did you know that Bureau of Economic Analysis (BEA) regional economic statistics, such as the annual state personal income statistics released September 25, 2012, are used to allocate billions of dollars in federal funds to state and local governments?

In fiscal year 2011, more than $339 billion in federal funds were distributed under programs using U.S. Bureau of Economic Analysis statistics in funding formulas.

Each year, BEA collects information and reports on the amounts distributed by federal programs using BEA regional economic statistics. BEA recently released reports detailing the allocation of amounts distributed in fiscal year 2011. The information can be found on BEA’s Web site under “Uses of the Regional Program Estimates”.

The use of BEA regional economic statistics in federal funding formulas is only one of the important uses of these data and is just one reason why the accuracy and timeliness of these statistics are so important.

August 2012 Trade Gap is $44.2 Billion

The U.S. monthly international trade deficit increased in August 2012, according to the U.S. Bureau of Economic Analysis and the U.S. Census Bureau. The deficit increased from $42.5 billion (revised) in July to $44.2 billion in August, as exports decreased more than imports. The previously published July deficit was $42.0 billion. The goods deficit increased $1.5 billion from July to $59.3 billion in August, and the services surplus decreased $0.3 billion to $15.1 billion.

Exports
Exports of goods and services decreased $1.9 billion in August to $181.3 billion, reflecting a decrease in exports of goods. Exports of services increased.
• The decrease in exports of goods was more than accounted for by decreases in industrial supplies and materials; foods, feeds, and beverages; and consumer goods. An increase in capital goods was partly offsetting.
• The increase in exports of services was more than accounted for by increases in other private services, which includes items such as business, professional, and technical services, insurance services, and financial services, and in other transportation, which includes freight and port services.

Imports
Imports of goods and services decreased $0.2 billion in August to $225.5 billion, reflecting a decrease in imports of goods. Imports of services increased.
• The decrease in imports of goods was more than accounted for by decreases in consumer goods; automotive vehicles, parts, and engines; and capital goods. An increase in industrial supplies and materials was partly offsetting.
• The increase in imports of services was more than accounted for by an increase in royalties and license fees, which included an increased amount for the rights to broadcast the portion of the 2012 Summer Olympic Games that occurred in August. July imports include a smaller amount for the portion of the Games that occurred in July.

Goods by geographic area (not seasonally adjusted)
• The goods deficit with Canada increased from $2.1 billion in July to $2.4 billion in August. Exports increased $1.9 billion to $24.7 billion, while imports increased $2.2 billion to $27.0 billion.
• The goods deficit with China decreased from $29.4 billion in July to $28.7 billion in August. Exports increased $0.1 billion to $8.6 billion, while imports decreased $0.6 billion to $37.3 billion.
• The goods deficit with the European Union decreased from $12.0 billion in July to $11.7 billion in August. Exports increased $0.8 billion to $21.3 billion, while imports increased $0.5 billion to $33.1 billion.

To learn more about U.S. international trade in goods and services, read the full report.