N.H. at 'high risk' from a European recession



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A new report has found that if Europe slides into a recession, New Hampshire is at "high risk" of being negatively affected, but not nearly as much as some other states.Released by Wells Fargo Securities' Economics Group, the report was a follow-up to its October monthly outlook, in which the financial services company said it believed Europe was sliding into at least a mild recession.While there has been much speculation about how that would affect the U.S. economy as a whole, the report sought to investigate the impact a recession would have on individual states.It found that while the U.S. economy would probably only be modestly affected, "there are a handful of states that may be more vulnerable," reads the report.New Hampshire was among the states declared at "high risk" of being more severely impacted. That's because 1.89 percent of the state's gross domestic product is made up of goods exported to Europe.The report figures that the more goods a state exports to Europe, the more likely it is to be hurt if the continent falls into recession. It does acknowledge that looking only at export of goods doesn't completely illuminate how much risk states face, but concluded that it was still a measure worthy of consideration.When compared nationally, New Hampshire exports a smaller percentage of its GDP than does the U.S. as a whole. Exports to Europe account for 1.97 percent of the country's GDP.But, according to the report, New Hampshire may not be the most affected in New England. Massachusetts (2.82 percent) and Connecticut (2.96 percent) are both considered "highest risk." Vermont (1.31 percent) is "moderate" risk and Rhode Island (1.11 percent) and Maine (0.81 percent) are both "low" risk.The states with the most European exposure in export of goods are Utah (5.56 percent), South Carolina (4.1 percent), West Virginia (3.9 percent), Louisiana (3.47 percent) and Kentucky (3.1 percent). Many of these states ranked high because they export commodities, like gold and silver from Utah and coal from West Virginia.In 2010, New Hampshire's top export markets were Mexico, Canada and China. But fourth and fifth on the list were Germany and the United Kingdom, which accounted for $223 million and $207 million in export volume respectively."With many states continuing to struggle with the effects of the sluggish U.S. economic recovery, the prospect of some additional challenges as the European Union slips back into a recession over the next couple of quarters represents another hurdle," the report said. -- KATHLEEN CALLAHAN/NEW HAMPSHIRE BUSINESS REVIEW Edit ModuleShow Tags