The balance of trade (BOT) is the difference between the value of a country’s imports and exports over a given period and is the largest component of a country’s balance of payments (BOP).
A country that imports more goods and services than it exports in value terms has a trade deficit, and a country that exports more goods and services than it imports has a trade surplus.
By itself, a favorable trade balance is not enough to assess the health of the economy. It is important to consider the balance of trade in relation to other economic indicators, business cycles and other indicators.
The United States regularly runs a trade deficit, while China usually runs a large trade surplus.