Connecticut’s exports continued their double-digit growth in 2007 as the state benefited from a weak dollar, popular products and a strengthening relationship with Asian countries.
The value of state’s export commodities grew 12.1 percent last year to $13.72 billion, according to the state Department of Economic and Community Development. That jump follows a 26.3 percent gain in 2006. The report does not include service export data because it is more difficult to collect.
Commodity exports alone have grown to represent roughly 7 percent of the Connecticut economy. Given the dollar’s continuing weakness and the international demand for the state’s high-tech manufacturing products, that percentage is apt to rise, according to Peter Gioia, an economist with the CBIA.
The Weak Dollar
“When you compare the dollar to the euro, you’ve essentially got a serious sale going on,” Gioia said.
The euro has steadily strengthened versus the dollar since its introduction as a currency in 1999. Valued at less than 90 cents in 2001, the euro is now worth more than $1.55.
While currency trends are helping all American exporters, Connecticut’s exporters have outpaced every New England state except Massachusetts. Gioia attributed that strength to the state’s export mix, which includes aerospace, medical and defense-related products.
“We are better than anyone else in these sectors,” he said.
Industrial machinery commodities accounted for $5.8 billion in Connecticut exports in 2007, almost half of all exported goods. The biggest gainer was electric machinery, such as sound and television equipment, which boasted a 41.6 percent gain.
Canada remained the top country for Connecticut exports in 2007, with $1.8 billion, although that was a 6.8 percent decline from 2006.
But France and Germany, which ranked second and third, respectively, in 2007, recorded double-digit increases last year in imports from Connecticut. Those imports totaled more than $3 billion.
Laura Jaworski, international trade specialist for the state Department of Economic and Community Development, said Canada has traditionally been the state’s top partner because companies new to exporting view it as a logical first step.
“For those companies brand, brand new to exporting, we suggest an easier market to enter like Canada,” she said. “There is no language barrier, and in just a few hours’ drive from Connecticut, you have hit a significant market.”
In Western Europe, growing exports to the Netherlands complements strength in France and Germany. Exports to the Netherlands, a logistics center and cargo hub, were up 14 percent in 2007.
Jaworski said growing trade with the Dutch looks promising “now that Bradley Airport offers daily, nonstop service” to Amsterdam.
Asia Rising
While Canada and Europe have consistently been strong trade partners for Connecticut, Gioia said an increasing number of state companies are looking toward Asia.
The most dramatic increases in Connecticut exports, on a percentage basis, were with Asian countries. Exports to China leaped 52 percent, while exports to South Korea surged 46 percent.
Connecticut’s top five export commodities to China all experienced growth in 2007. Most notable was the category for aircraft, spacecraft and related parts, which increased 389.6 percent.
“We have to monitor China,” Jaworski said. “Is it something that will be sustained?”
