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Spring 1997 - Volume 2, No. 4

Tennessee International Trade Report
4th Quarter 1996

Tennessee exporters saved the best until last: 4th Quarter exports rose to $2.24 billion, 5.6 percent above a year ago. This was the largest quarterly increase of the year, and partially salvaged an otherwise lackluster 1996. The state was unable to repeat the sterling performances of the past several years, as its exports grew but 0.6 percent in 1996, well below the 6.8 percent national average.

In many ways the 4th quarter repeated the same pattern as earlier in the year. The state's major markets continued strong, with exports to Canada increasing by 12.5 percent, to Mexico 22.22 percent, and to Japan 9.6 percent. But much of these gains were undercut by losses in sales elsewhere. Among the regions of the world, only on the Indian Subcontinent and in the Caribbean and Central America did Tennessee see significantly increased exports. Egypt and Israel also grew dramatically. Indeed Governor Sundquist's trade mission to Israel was matched by a doubling in that country's exports. On the other hand, exports to the entire Middle East were flat, and sales to Africa fell markedly. Exports to South America were off slightly. Brazil, however, continued its steady growth and looks poised to soon become one the state's ten top markets. Problems continued in the China economic area, where a solid gain in Hong Kong could not cover the loss of almost one third of sales to Taiwan as well as the continuing decline in exports to China itself. Sales to the rest of Asia dropped some $20 million for the quarter.

It was Europe which accounted for the improved 4th quarter results. Though net exports to Europe were essentially flat from last year, this was a big improvement from the 3rd quarter's multimillion dollar loss in sales. Even here the news was mixed: a $15 million increase in exports to Ireland and the U.K. was almost exactly offset by losses in the other E.U. states.

Once again, export declines were concentrated in several industries. Exports of the state's agricultural crops fell by almost one half, down $30 million dollars. Sales to China and elsewhere in Asia were particularly weak. The primary metals industry suffered similar problems, with its exports dropping by a quarter from a year ago. The weakness of these two sectors was in fact the major cloud in Tennessee's 1996 export picture. Together their foreign sales fell $370 million from 1995, a sizable drop difficult to make up elsewhere.

But Tennessee's three largest exports sectors, transportation, chemicals, and industrial machinery, again all made healthy gains. The small metal mining industry soared: up better than 70000 percent! But perhaps the most remarkable performance was the continuing robust export growth of the medical and scientific instrument sector. Here exports were up almost 40 percent for the quarter, and better than 27 percent for the year.

1997 is off to a fair start. January 1997 exports were up a solid 5.1 percent from a year ago, though this still lagged America's overall export growth rate.

Tennessee's Largest Export Sectors, 4th Quarter 1996

Tennessee's Leading Trade Partners

Tennessee's Exports of Apparels, 4th Quarter 1996

(Apparels continue to be one of the state's best performing export sectors)

Tennessee's Exports to Honduras, 4th Quarter 1996

Largest Growth and Decline in Exports by Industry, 4th Quarter 1996

Fast Changing Export Destinations, 4th Quarter 1996
Among countries averaging more than $2 million in sales per quarter.

Tennessee Monthly Exports
(Seasonally adjusted, expressed in 1993 dollars)
Exports in $Millions                                                     Nominal Growth Rate (%)

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