Detailed Consultancy Report: Developments in the US Economy

This report provides a detailed analysis of the US economy, focusing on recent developments and its contribution to the global economy. It examines key aspects such as international trade, including import and export dynamics, and the role of the US in the global market. The report also explores foreign direct investment (FDI) in the US, highlighting its significance and attractiveness to investors. Furthermore, it delves into economic development, analyzing factors like GDP, unemployment rates, and the impact of government policies. The methodology employed is secondary research, utilizing data from various sources to assess the current economic conditions and future prospects of the United States. The report concludes with an evaluation of the US economy's strengths, challenges, and its impact on the global stage.

USA Economy
Consultancy Report

Contents
EXECUTIVE SUMMARY.............................................................................................................1
INTRODUCTION...........................................................................................................................1
BACK GROUND............................................................................................................................2
METHODOLOGY..........................................................................................................................3
Data collection:............................................................................................................................3
Data analysis:...............................................................................................................................3
DESCRIPTION...............................................................................................................................3
International trade........................................................................................................................3
Foreign Direct Investment...........................................................................................................5
Economic development...............................................................................................................6
Globalisation................................................................................................................................6
SOLUTION.....................................................................................................................................7
Strengthening the policies............................................................................................................7
Changes in methods.....................................................................................................................7
Increase in investments................................................................................................................8
EVALUATION...............................................................................................................................9
DEGREE OF CONSULTANCY...................................................................................................10
CONTRIBUTION.........................................................................................................................10
CONCLUSION..............................................................................................................................12
REFERNCES.................................................................................................................................13

EXECUTIVE SUMMARY
USA is the most powerful and developed nations of world which is arising as marker and
global leaders in many terms. The foreign trade of USA would be comprising of both exports
and imports which makes it most important or vital dealer in global market. All the regulations
of USA in regard of trading would be with US Congress which is the largest ruling party of
country. Under this study which is would be highlighting developments that have been taken
place in recent years within US economy in terms of political or economy, methods which are to
be undertaken are those related to secondary research. So in this current topic which is
underlying various important types of developments in US and its contribution to global
economy secondary data would be taken.
INTRODUCTION
The recent developments and contribution of United States to the Global economy is very
excellent. The US economy sometimes seen as 'the engine' of the world economy. Any
slowdowns in the economy of United States increase the concerns about the harmful effect to the
other economies. In the year 2007, the concerns of investors and policy makers are even against
of past recession in United Kingdom (Knudsen, 2018). A growth upsurge in the world biggest
economy could render an important advancement to worldwide activity unsteadily about the path
of US policies could have the opposite result. USA is contributing about quarter in the world
economy. The market exchange rates of USA are one-fifth of global FDI. The election of Donald
Trump's as US president has trigged an upsurge in positivity in economy. He pursues the policy
transfect of deregulation, cut the taxes and reforms and building of infrastructure.
As per the key indicators, the USA economy is healthy in compare to other economies.
GDP is the most critical indicators which measures the production output of nation. The GDP
growth rate is foreseen to remain between 2.2% to 3.2 % idealistic range. The rate of
unemployment is expected to remain at the normal rate. There is no so much inflation and
deflation in the economy. The personal disposable income of individual is 0.3 % in 2017. The
economic growth of industries of US is 2.9 % in 2017. The most common currency widely used
in the world is USA currency. USA is the most significant destination of export which is about
one-fifth counties across the world. The impact of global economy has made alterations in USA
monetary policy (Kirchherr, Reike and Hekkert, 2017). The trade policies of USA are also
affected by global effect. A modification in US activity can assist growth in trading partners
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directly through an increase in the demand. By 0.8% of growth is boosted by US economies. The
GDP growth has risen to 2.8 % in 2018. Federal Open Market Committee meeting which was
conducted on 28 march 2018, anticipate that there will be 2.4 % of GDP growth in 2019 and 2%
in 2020. The unemployment rate will be drib to 3.8 % in 2018.
BACK GROUND
US political development includes comparative politics, public laws and political theory
and disciplines of sociology. There are four types of political system in US which are
Presidential system, Liberal system, constitutional system and Federal system. The United States
is a symbolic democracy as people elect representatives to govern the county. Political traditions,
customs, belief and values are shared by people of US (Ghinea and Lipworth, 2017). The
Federal Government and state government of US organize social welfare programmes for the
betterment of society. The resources and management can only be avail by government of US.
US government is organizing many programmes like medical health insurance programmes, old
age, widow and many others which have direct impact on the betterment of society. US are also
developing many schools as well as nutrition programmes for them. By the end of 19th century
subsidy has become the characteristics of government participation in the economic life in US.
The population of US in 2013 is 317 million which increased to 326 million in 2017 was. The
GDP per capita in US dollars is 52,705 in 2013 which is increased to 57,436 in 2016. The
economic growth of US is 1.7 % in 2013 which was decreased up to 1.6 % in 2016. The
Domestic demand in 2013 is 1.4 % which was increased up to 1.7 % in 2016. The annual
consumption is about 2.7 % in 2016 which was increased by 1.2 % from 2013. The rate of
interest on policy is .25 % in 2013 which was increases up to 0.75 % in 2016. The stock market
of US is 13.4 in 2016. The rate of inflation is 1.3 % in 2016 which was controlled by 0.2 % from
2013.
These developments have affect the economic growth as a whole of United States. But
the more development in the economy of US is contributed by private and public sectors of
country. Economic development also contributed large to the standard of living of US and about
72% of people has improved their standard of living by the economic development of US
economy Generally, people of country becomes more developed. The health, education, security
and many other factors are developed by the development of economy (Bonfato, Hansing and
Silva, 2017). The population of US has positively affected by the development of economy. The
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population is controlled but still it is not up to the mark. Increase population exert pressure on the
economy of country as because resources are limited.
METHODOLOGY
Under this study which is would be highlighting developments that have been taken place
in recent years within US economy in terms of political or economy, methods which are to be
undertaken are those related to secondary research.
Data collection:
This is the most important part of any type of research which is to be conducted that is
forecasting what would be outcome or result of the collected data. It is having two types of
sources or methods like that of primary and secondary one. Both of them are very much
important in sense this is defining how data is to be collected and then deciding over which type
of information is most suitable one. Primary source of data would be that which is helping in
analysing results or outcomes in form of collecting from fresh sources like that of surveys,
questionnaires and observations (Toh and Yasini, 2017). While on the other hand secondary
would be that which is take from all type of books, journals, articles and already conducted
research. So in this current topic which is underlying various important types of developments in
US and its contribution to global economy secondary data would be taken.
Data analysis:
This is analysing or evaluating data which was collected from various source so that one
particular results could be come up. Data analysis is also important in sense as this help us to
understand what is the actual result or outcome of research that is been conducted.
DESCRIPTION
It is important that USA government is prioritising over coming next 2-3 years so that
they could be able to emerge from their current situation. Most important points are like that of
international trade, FDI, economic development, globalisation. All these points are very much
important as they would be describing how economy of USA could be growing or how its
economic conditions are too changed.
International trade
Trade refers to exchange of goods and service between two or more person in regard or
terms of flow or money. This phenomenon is very old as people are been trading in exchange of
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money since very long time and with this only international trade is introduced. International
trade is the exchange of goods and service between two borders or territories which is
incorporating inflow and outflow of foreign exchanges. USA is the most powerful and developed
nations of world which is arising as marker and global leaders in many terms. The foreign trade
of USA would be comprising of both exports and imports which makes it most important or vital
dealer in global market. All the regulations of USA in regard of trading would be with US
Congress which is the largest ruling party of country (Safa, Weeks and Al Azam, 2017). It was
after the period of Great Depression country was able to handle and emerge as most successful
economies of world. USA is having its trading relations with about all nations of world and
having many international trade agreements as well. These would be including like that of WTO,
GATT and many other custom trade policies with rest of world.
Figure 1: USA international trade
[Source: USA international trade, 2018]
This topic is been included within this research so that it becomes easy to understand
what is the importance of international trade in USA and how much revenue country is
generating in current time. USA is having almost all countries as its trading partner but the most
prominent or important are countries of Europe and Asia. USA is importing and exporting many
goods and service like that of cotton, machines, tea, sugar, mineral oil etc.
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Foreign Direct Investment
Figure 2: FDI ranking
[Source: The Importance of FDI to the U.S. Economy, 2018]
This would be including that inflow of cash or money in terms of foreign currency in
form of investments done by them. Foreign direct investment is that type of investment which is
mainly aiming at controlling of ownership within business of specified business either by entity
based on that country or only by investing money (The Importance of FDI to the U.S. Economy,
2018). At the current time USA is the single largest country which is recipient of FDI in world
and is actively competing with all countries of world to retain its share of market. In year 2016
USA was having FDI of about $3.75 trillion which is highest in world. USA is also regarded to
as best choice for many investors around the world as they are been able to identify the
significant of country. USA is the most attractive country in terms of FDI from investors all
around the world by taking up their decision on major factors. These would be including like that
of availability of labour, complexity of tax, strength in public education systems,
macroeconomics policies and transparency of regulatory environment.
This would be explained by examples of some biggest companies within USA like that of
Honda which is investing about $17 billion in country and is having the strongest presence in
manufacturing factory (Dewachi, 2017). On other hand Nestle which is Swiss multinational
company is also giving employment to about 51000 employees and having 87 factories within
USA.
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Economic development
Figure 3: United States Economy Data
[Source: U.S. Economic Outlook, 2018]
The process which is enabling nations and economies of world to improve their health,
political stability and economic conditions is regarded to as economic development within that
nation. As it was stated that US is the highly developed mixed form of economy in terms of GDP
it is largest and in Purchasing power parity it is second largest. During April 2018 the
unemployment rate of country was at its lowest since the time of 2000 and this was done due to
increase in wage rate and tax reforms as well. On the same hand other factors like that of
production, rate of consumption, household tax should be in accordance with consumer spending
(Uyanik, 2017). USA is also having its major dispute with China against which economy
planned for 25% increase tariff on imported Chinese goods. In this sense it would be regarded
that China is the biggest competitor of USA in terms of investments and trading with other parts
of world. GDP of USA expanded to 2.8% in year 2018 and it was estimated in 2019 to as 2.4%.
Globalisation
This is measured as the process of one organisation having or developing its relationship
with other firms who all are having in other countries or starting operating into international
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scale. Process of globalisation is very impacting into country like that of USA which is global
financial leader in world market. With the help of globalisation there are many markets which
has been opening up for country and this is enabling companies of America to sell out their
products worldwide level. There are many companies of world which are having their outlets and
establishment in USA and selling their products there at cheaper rates and increasing level of
employment as well (The United States in the World Economy, 2018). Still there are many
negative impact of this globalisation on economy or people of USA like that of having major
deficit in trade.
SOLUTION
There are major issues which are taking place in USA like that of deficit in trade,
fluctuation of economic conditions and unemployment. So they must be taking many steps in
collaborating these conditions and situations of country like widening up their scope of policy or
regulating as well. These solutions which is to be laid down should be helping economy of USA
that they are been formulating new reforms into their policies so that it could be helpful for them.
Government is having major role to be played at time when country is having issue or they are
facing many problems as well.
Strengthening the policies
This is the major and bigger step which country should take so that it is able to solve
issue like that of trading or exchange of goods and services. Government is having the most
crucial role while they are dealing with rest of the world they are the one who forms policy and
implement that too (How has Globalization Impacted the U.S. and its Citizens?, 2018). If
economy of USA would be like to expand its market share and strengthening position within
worlds market then all policy in respect of tax, employment and inflation as well. In this way out
it should be governing that all policies are been correctly implemented so that growth of
economy could be resolved.
Changes in methods
This is also one of the most important steps which would be helping in resolving the
issues related to globalisation. As there is very much increased globalisation in USA which is not
allowing citizen of USA to cope up with their unemployment. Other than this international trade
and investment is also having very much important drivers of economic growth which is shaping
world and changing economies as well. There are many changes which are taking place around
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the world and they are trading now with modern methods not that related to traditional one.
Foreign direct investment is that part of trading which is helping both two countries into their
growth and trading with many international partners (What's the deal with global trade and
investment?, 2018).
Increase in investments
Figure 4: World exports volume
[Source: What's the deal with global trade and investment?, 2018]
It is required as per the government or economy of that they must be growing and
increasing rate of investment with country so that this would be helping country in better trading
with rest of the world. All the global trade agreements with other countries of world are helping
USA to reform their overall trade framework. With the help of this they could be having
adequate regulations, employment and environmental issues which they need to resolve. As it
was seen that total level of world exports and price of exports are been falling since 2010 which
is such a matter of concern (U.S. Economic Outlook, 2018). So USA government and agencies
must be making efforts in growing power and exports volume which is intended to increase the
rate of investment within country.
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EVALUATION
Under this section all point which are been included in above parts would be evaluate so
that they are taken on particular judgement or conclusion about condition of USA at current
state. In year 2017 country was facing many issues like that of housing sector, elections of USA,
fiscal and growth of USA economy. On account of depression in year 2007 which was causing
governments of world and economies not allowing them to work in accordance with set policies
and plans. It was included that housing sector of USA economy was having more than its
anticipated rate of interests. Then after that it came to back to normal with the said effects of
policy and structural development. The current rates which were increasing on normal bases with
both price of home and that of higher mortgage payments as well. In year 2017 there was having
more that 10% increase in housing price which was only after elections held in that particular
year (The Importance of FDI to the U.S. Economy, 2018). Due to this investment by the citizen
of USA was decreased need to be changed and growth should be there.
It was also evaluated that increase in FDI within GDP of USA would be making way to
rise in many factors like that of employment, growth, larger consumer products and encouraging
innovations as well. There are many reasons which is involving growth and development of USA
economy which is attracting many foreign investors to establish their operations in other
countries or providing capital into the existing operations as well. There was largest inflow of
cash in year 2016 which is recorded to about $457.8 billion which is lower than that of 2016
which was $465.8 billion in 2015. It was recorded to as increased investment in manufacturing
like that of chemical leading to increased investment inflow in both years of 2015-2016.
USA was having largest share of international trade as compared to rest of the world
which is leading to national growth in economy of USA. There are still increasing disparities and
inequalities between people who are living into economies of world as they are been having gap
in their pay and wealth as well. On part of government which is making efforts into their federal
policy making during their past 50 year which is also marking their strength of nation. The
central government is making their efforts at improving problems and issues which is sustaining
into economy of USA.
Increasing the rate of investment would be rated as the greatest or most important
priorities of economy of USA during this current or past decades (USA international trade,
2018). As it was noticed that USA is the largest source of FDI in accordance with other countries
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of world which is having around 16.1% share of total FDI of world. As included in above part
that in year 2015 USA was having highest record of Foreign Development Investment to about
$348 billion. Thus this was helping country to contribute in economic growth and then having
competitiveness in world which is correlating with advantages. There are many factors which are
included as most important advantages for USA in terms of their strong base in world class
education systems, access to capital, expansion of market and innovation as well.
DEGREE OF CONSULTANCY
As all the important factors which are been included like that of international trade,
globalisation, FDI and economic development are most vital. All of these sections would be
telling how USA is contributing to the global economy and how it is giving chance to new
sectors or business to grow within. Factor like that of international trade is making growth and
development of USA to be considered in most efficient manner. The amount of inflow and
outflow of goods and service within economy of USA is making it addressing in correct order
(Pashkevich and Haftor, 2017). USA is having strong global position which is having
implication of the issues like that of unemployment within economy. It is having more
integration of trade up to $1 trillion per year which is gaining globalisation and this account to
about 10% of the total house hold income.
The imports would be lowering down the price of goods which are then lowering down
inflation of the country. In this way there are number of goods that are been offered to consumers
of world in both industrial and consumer products. Whereas on other hand if the exports are been
increased then this would be leading to enhance the wages for the workers to about 15-20%
within industries and sectors of world (Gafurov, Safiullin and Elshin, 2017). If there is more
increased amount of competition that too from other countries of world then this would be
leading to improvement in productivity of country and then giving higher level of income as
well.
CONTRIBUTION
United States is one of the strong and powerful economic powers in the world. United
Stated plays essential role in the development and growth of world economy the gross national
income of world is 39,208 billion $ by which $12,150 billion is contributed by United States.
Scientific contribution in the world is largely contributed by USA about 3.676 scientist per
million are from USA which is third ratio in the world. Information technology is also
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contributed by USA in large as USA has the highest number of computers in the world (Toh and
Yasini, 2017). In the technology of exporter, US are one of the large exporter among all the
countries. The GDP of US is $13.22 trillion in the world which is the largest in 2006. Further, the
contribution in finance by US with many countries is large (Roy, 2017). The liability of US to
foreign countries was $10.4 trillion in 2005. The position of net investment of US in 2005 is $2.7
trillion. US have excellent roles in current account deficient.
The contribution of US in the development and growth in economy is not sum-up with
small achievements. There are various other sectors also where US has large contribution. In the
field of employment about more than 41 million people in the world are depended on the
American trade. The trade of US is very successful trade as compare to other countries. As per
the statically data from Federal Reserve bank of St. Louis, the production output is real term has
increased up to 80% since 25 years. There are about 3 lakes a company of United States about
98% of export is contributes by US companies. Small scale companies of US have contributes
one-third of the exports to global economy. US have vast productivity gains relating to high use
of automation and information technologies (Gordon and et.al, 2017). The manufactured goods
in export of US have reached up to $1.3 trillion in 2016 which is about 62% of all exports of US.
The Commerce department of US measured that about 6 million of factory jobs are exported by
US Company.
Moreover, US have large contribution on exporting of many crops such as wheat and
almonds. About more than half is exported to many counties. The agriculture of US is very
productive. The most admirable contribution from US by agriculture sector in global economy is
about three acres farms are planted for exports. USA is also imports fresh fruits in winter. About
$18,000 per year is imported by American households.
Addition to all these, there are excellent advantages has seen from free trade agreements
of US which covers about 20 nations in the world. These all 20 nations represent about 6 % of
world population outside the US. From last year it was reported that about half of US exports are
purchased by these markets. Canada and Mexico are the biggest trading partners in United
States. About 14 million of employment is supported by Mexico and Canada and they generate
about $1.3 trillion yearly in goods and services. KORUS FTA is the strongest free trade
agreement in the world (Blasi, Kruse and Freeman, 2017). It is spreading so many jobs
opportunities and paying Korean investments in United States.
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CONCLUSION
The above report summarize that the role of United States has immense contribution on
the development and growth of the global economy. The contribution of GDP in the
development and growth of economy is largest among all the countries. The development of
economic, political. Social has the greatest contribution towards the global economy. This
development has direct impact on the economic situations of economy. Furthermore, the current
economic position of United Stated in world economy is also contributed. Additionally, this
report also make understood the international trade, political economy, globalisation, FDI,
Ethics, Regional economic development, culture etc. which is very essential for UK.
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REFERNCES
Books and Journals
Blasi, J., Kruse, D. and Freeman, R.B., 2017. Evidence: What the US Research Shows about
Worker Ownership. Oxford University Press Handbook of Mutual, Co-Operative and Co-
Owned Business.
Bonfato, A.C., Hansing, B. and Silva, E.C., 2017. TREVPAR’s Rates Development, Average
Income and OCC of Brazilian’s Resorts During 2014/2015 Two-Year-Time. Journal of
Geography and Geology, 9(3), p.59.
Dewachi, A., 2017. Smart Digital Transformation in Government Consultancy Report prepared
for UN ESCWA.
Gafurov, I.R., Safiullin, M.R. and Elshin, L.A., 2017. Mechanisms of higher school
development in the paradigm of its global competitiveness (on the example of the kazan
federal university). QUID: Investigación, Ciencia y Tecnología, (1), pp.1495-1500.
Ghinea, N. and Lipworth, W., 2017. Faster access to new drugs doesn’t always mean better
treatment.
Gordon, J and et.al, 2017. Final Scientific Report: The 45 Mile Hydropower Project Report for
the US Department of Energy–Office of Energy Efficiency and Renewable Energy: Wind &
Water Power Program (No. DOE-EBD-0005430). Earth By Design, Inc..
Kirchherr, J., Reike, D. and Hekkert, M., 2017. Conceptualizing the circular economy: An
analysis of 114 definitions. Resources, Conservation and Recycling, 127, pp.221-232.
Knudsen, J.S., 2018. Government Regulation of International Corporate Social Responsibility
in the US and the UK: How Domestic Institutions Shape Mandatory and Supportive
Initiatives. British Journal of Industrial Relations, 56(1), pp.164-188.
Pashkevich, V. and Haftor, D.M., 2017. An Analytical Framework for the Analysis of an
Information Economy. In Strategic Innovative Marketing (pp. 647-653). Springer, Cham.
Roy, P.K., 2017. Demonetisation & its Impact on Indian Economy. The Management
Accountant Journal, 52(4), pp.48-51.
Safa, M., Weeks, K., and Al Azam, A., 2017, July. Strategic Port Human Resource Talent
Acquisition and Training: Challenges and Opportunities. In International Conference on
Applied Human Factors and Ergonomics (pp. 205-215). Springer, Cham.
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Toh, T.M. and Yasini, B., 2017. Comparing Micro Finance Practices to Ethical Codes: Case of
Afghanistan and Cameroon.
Uyanik, S., 2017. Turkey's shale gas potential and comparison of its success factors with the US
and European developments. International Journal of Energy Technology and
Policy, 13(4), pp.293-304.
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