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US multinationals sold services in markets abroad
Nov 17, 2000

US multinationals sold services in markets abroad worth $309.0 billion through their foreign affiliates in 1998, the last years for which data on sales through majority-owned affiliates of multinational companies abroad is available. In the same year, US consumers purchased $255.1 billion in services provided by affiliates of foreign multinationals. To put these facts in perspective, exports through commercial presence, as the World Trade Organization classifies this mode of trade in services were larger than the $254.7 billion exported across the borders in 1999. Similarly, purchases by US consumers in 1998 exceeded cross-border services imports worth $174.8 billion in 1999. These differences are only likely to increase. While cross-border services exports grew 4% last year and services cross-border imports did at an 8% rate, sales of US multinationals increased 14% and purchases by US consumers grew 21%. If sales by US affiliates were to continue growing at the 14.7% average rate exhibited since 1986 when BEA first reported this data, the amount exported though commercial presence mode of delivery would total $613 billion in 2003. That amount is almost 70% more than the value of US cross-border exports projected for that same year by the University of Michigan Forecast.

Source: featured article in the 2000 October Survey of Current Business. U.S. International Services Cross-Border Trade in 1999 and Sales Through Affiliates in 1998 prepared by Michael A. Mann, Laura L Brokenbaugh, and Sylvia E. Bargas. US Bureau of Economic Analysis. Department of Commerce. The report is available for download in the Library section of this website and in the BEA website. The University of Michigan Forecast commissioned by the Mark Twain Institute is available in this website for download.

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