WTO: Asia trade volume to grow in 2014-2015

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Thursday, April 17, 2014


WORLD trade is expected to grow at a modest pace in 2014 and at a slightly faster rate in 2015, with Asia expected to lead all regions in import and export growth over the next two years, world economists forecast.

Global merchandise trade is expected to post a 4.7 percent increase in 2014 and 5.3 percent in 2015, according to the World Trade Organization (WTO).

Export volume of developed economies is seen to grow 3.6 percent in 2014 and 4.3 percent in 2015, while developing economies including the Commonwealth of Independent States (CIS) are predicted to advance 6.4 percent this year and 6.8 percent next year.

Exports from Asia are expected to grow faster than those from any other region, at 6.9 percent in 2014 and 7.2 percent in 2015.

On the import side, the 4.7 percent increase in world trade in 2014 will be split between developed economies growing at 3.4 percent, and developing economies growing at 6.3 percent.

In 2015, world imports are expected to rise 3.9 for developed economies and 7.1 percent for developing economies.

Asia should also lead all regions in import growth in 2014 with 6.4 percent and in 2015 with 7 percent. "However, Asian import growth is likely to be unbalanced, with larger gains in China and smaller increases in other developing Asian economies," the WTO said.

Prospects for world trade and output in 2014 and 2015 are better than they have been for some time, but leading economies remain fragile, including some of the most dynamic developing countries that until recently were propping up global demand, the WTO said.

Risks to trade abound, but significant potential also exists, as the US economy seems to be gaining momentum and the European Union appears to have turned a corner. At the same time, developing economies have slowed appreciably, for a variety of reasons both internal and external.

"Which of these forces is stronger may determine how world trade evolves over the next 1 to 2 years," the WTO report said.

Although the 2014 forecast of 4.7 percent is more than double the 2.1 percent increase of last year, it remains below the 20-year average of 5.3 percent. For the past two years, growth has averaged only 2.2 percent.

"For the last two years trade growth has been sluggish. Looking ahead, if GDP forecasts hold true, we expect a broad-based but modest upturn in 2014, and further consolidation of this growth in 2015," WTO director-general Roberto Azevedo said.

The trade forecast for 2014 assumes a three percent growth in world GDP, while the forecast for 2015 assumes output growth of 3.1 percent.
For developed economies taken together, GDP growth for the whole of 2013 was 1.1 percent, lower than the 1.3 percent rate recorded in 2012 and 1.5 percent expansion of 2011.

Asia recorded the fastest GDP growth in 2013 at 4.2 percent, which was almost equal to growth in the previous two years.

World merchandise trade volume rose 2.1 percent to $18.8 trillion in 2013. Exports of developed economies grew more slowly than the world average at 1.5 percent, while shipments from developing countries grew faster than average at 3.3 percent.

On the import side, developed economies recorded a small decline of 2 percent, while developing economies increased by 4.4 percent.
Asia's exports grew faster than any other region's last year, with a 4.6 percent rise, while regional imports were also the fastest at 4.4 percent.

The top five exporters in 2013 were China, the United States, Germany, Japan, and the Netherlands. The leading importers were the United States, China, Germany, Japan and France.

If all 28 European Union members are counted as a single entity and excluding intra-EU trade, the leading exporters last year were the European Union, China, the United States, Japan, and South Korea.
The leading importers when intra-EU trade is excluded were the United States, the European Union, China, Japan, and Hong Kong. (Philexport)

Published in the Sun.Star Cagayan de Oro newspaper on April 17, 2014.

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