U.S. deficit provokes analysts concerns

WASHINGTON, Feb. 14 (UPI) -- The U.S. international trade deficit declined 0.6 point last year, the Commerce Department reported Thursday, but analysts say it remains a threat.

The $711.6 billion is a decline from the nation's $785.5 billion deficit in 2006 but is still high in relation to the county's gross national product, economist Peter Morici of the University of Maryland said.

The U.S. Commerce Department said deficit had shrunk from 5.7 percent of the GNP in 2006 to 5.1 percent in 2007.

To finance the deficit the United States has borrowed $6.5 trillion or $2,000 for each U.S. worker, he said. The deficit also reduces the GNP by $250 billion annually, "significantly adding to the pain imposed by the unfolding recession," he said.

Morici said the trade gap with China and the Middle Eastern oil exporting countries open up 20 percent of U.S. companies to the possibility of foreign ownership.

"This should give Americans real pause for concern about Chinese and other foreign government intentions to diversify their foreign exchange holdings into U.S. stocks and other real assets," he said.

Exports increased from $176.1 billion in 2006 to $1.621 trillion in 2007. But, imports were also up, increasing $129.2 billion to $2.333 trillion.