Global Infrastructure Demand to Drive U.S. Trade Higher: HSBC Report

  Global Infrastructure Demand to Drive U.S. Trade Higher: HSBC Report

         **HSBC U.S. Trade Confidence Index rises to all time high**

**Latin America is most promising region for U.S. export growth in near term**

Business Wire

NEW YORK -- October 8, 2013

U.S. business leaders expect trade to rise in the next six months as global
economic conditions improve and demand for infrastructure goods soars,
according to the latest data from the U.S. HSBC Global Connections Trade
Report.

U.S. businesses reported increased confidence in near term trade prospects,
pushing the HSBC Trade Confidence Index from 107 to 114, an all-time high
since the index’s inception, and higher than the global index average of 112.
The index is an international survey of small and middle market businesses,
including about 300 in the U.S., engaged in cross-border trade. Additionally,
67 percent of U.S. business leaders surveyed expect export and import volumes
to rise in the next six months, up from 48 percent in the second half of 2012,
and 29 percent cited improved global economic conditions as the main reason
for increasing business, the report finds.

According to the report, which includes short-, mid-, and long-term trade
outlooks, industrial machinery and transport equipment are expected to be the
top U.S. export growth sectors, accounting for 35 percent of the growth in
exports over the next three years. Globally, infrastructure trade is set to
triple by 2030, growing at an average annual rate of nine percent from 2013 to
2030, and accounting for 54 percent of total global exports goods by 2030, up
from 45 percent in 2013. Infrastructure trade includes infrastructure goods –
the materials needed for infrastructure projects, and investment equipment –
the machinery required by businesses to boost production.^1

“Infrastructure is the bedrock that enables economic activity,” said Steve
Bottomley, Group General Manager and Head of Commercial Banking in North
America for HSBC. “The investment countries are making in infrastructure is
phenomenal and provides a huge opportunity for U.S. businesses looking to grow
and develop. By connecting businesses to international opportunities and
markets, HSBC is helping U.S. companies capitalize on this trend as well as
spur economic growth.”

And despite a recent slowdown in emerging markets, most U.S. business leaders
see Latin America (20 percent) as the most promising region for export trade
growth in the near term, followed by China (13 percent) and Canada (six
percent), the HSBC report shows.

“The U.S. has good access to a wide range of export markets because of its
geographical position, openness to trade and competitiveness, especially in
transport equipment and industrial machinery,” said Prabhat Vira, Regional
Head of Global Trade and Receivables Finance in North America for HSBC.
“Rising middle classes across Asia’s rapidly emerging markets will drive
significant infrastructure demand in the region. And as China looks to scale
the value chain in terms of the goods it manufactures, there is a strong
opportunity for developed economies like the U.S. to supply sophisticated
investment equipment to the country’s producers.”

Transport equipment helping power U.S. export growth to China

In fact, the HSBC Trade Forecast shows that U.S. transport exports to China
are expected to rise by over 10 percent to the 2030s. Other export findings
include:

  *U.S. exports to China will more than double over the next decades, from
    seven percent today to 18 percent in 2040;
  *Canada is and will remain the most important export market for the U.S. in
    the next two decades;
  *Average growth in U.S. exports will be close to six percent annually to
    2030.

Need to renew or replace capital stock fueling U.S. import growth

Demand for infrastructure products in developed markets remains strong because
economies like the U.S. must renew and replace existing capital stock to
maintain their own competitive advantage in supplying investment goods to the
rest of the world, the report shows. In fact, U.S. imports of transport
equipment and information, communications and technology equipment are set to
account for over half the growth in U.S. imports in the long term, the report
finds. Other import findings include:

  *By 2020, India will overtake the U.S. to become the lead importer of goods
    for infrastructure, as it invests to build its domestic networks, and
    China will outpace the U.S. to become the top importer of investment
    equipment, as it invests to boost its manufacturing productivity.

For a copy of the U.S. Global Connections Report, please visit
http://www.globalconnections.hsbc.com/. Additionally, for the first time, U.S.
businesses can map trade flows and sector growth trends via a new, free HSBC
Trade Forecast Tool available at
https://globalconnections.hsbc.com/global/en/tools-data.

An infographic which portrays key findings from the latest trade forecast is
also available upon request.

^1To equip for growth, countries around the world need:

  *Goods for infrastructure e.g. metals, minerals, buildings and transport
    equipment
  *Investment equipment e.g. specialised machinery, machinery for power
    generation, metal working machinery, office equipment, electrics and
    professional/scientific instruments

Notes to editors:

About the HSBC Trade Confidence Index (TCI)

The TCI is an international survey of small and mid-market businesses engaged
in cross-border trade and the largest trade confidence survey globally. The
TCI is prepared by TNS for HSBC. The TCI is drawn from the viewpoints of 5,800
exporters, importers and traders from small and mid-market enterprises on:
trade volume; buyer and supplier risks; the need for trade finance; access to
trade finance; and the impact of foreign exchange on their businesses. Views
were gathered from May 2013 through June 2013 for the latest TCI.

About the HSBC Trade Forecast - Modeled by Oxford Economics

Oxford Economics has tailored a unique service for HSBC which forecasts
bilateral trade for total exports/imports of goods, based on HSBC’s own
analysis and forecasts of the world economy to generate a full bilateral set
of trade flows for total imports and exports of goods. HSBC’s Global Trade
forecast encompasses trade data for 25 countries and territories key to world
trade.

About HSBC Bank USA, N.A.

HSBC Bank USA, National Association, with total assets of $183.9bn as of 31
March 2013 (US GAAP), serves 3 million customers through retail banking and
wealth management, commercial banking, private banking, asset management, and
global banking and markets segments. It operates more than 250 bank branches
throughout the United States. There are over 165 in New York State as well as
branches in: California; Connecticut; Delaware; Washington, D.C.; Florida;
Maryland; New Jersey; Pennsylvania; Oregon; Virginia; and Washington State.
HSBC Bank USA, N.A. is the principal subsidiary of HSBC USA Inc., an indirect,
wholly-owned subsidiary of HSBC North America Holdings Inc. HSBC Bank USA,
N.A. is a member of the FDIC.

Contact:

HSBC
Laura Sheridan Powers, +1-212-525-0115
laura.s.powers@us.hsbc.com
 
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