Photo by: Duane Daws
The World Trade Organisation (WTO) warned on Thursday that growth in the volume of world trade was likely to remain sluggish in 2016 at 2.8%, unchanged from levels recorded in 2015, which was the fourth consecutive year where growth in world merchandise trade remained below 3%.
WTO economists expected global trade growth to rise to 3.6% in 2017, well below the yearly average of 5% since 1990. In addition, risks to the forecast “tilted to the downside, including further slowing in emerging economies and financial volatility”.
The 2016 forecast was premised on world gross domestic growth of 2.4%.
Director-general Roberto Azevêdo described the 2015 performance and the 2016 outlook as disappointing, noting, too, that while the volume of global trade had grown, its value had fallen as a result of shifting exchange rates and falls in commodity prices.
The dollar value of merchandise trade fell 13% to $16.5-trillion in 2015, from $19-trillion in 2014, while trade in commercial services declined 6.4% to $4.7-trillion.
“This could undermine fragile economic growth in vulnerable developing countries. There remains as well the threat of creeping protectionism as many governments continue to apply trade restrictions and the stock of these barriers continues to grow," Azevêdo said.
Developed economy imports rose 4.5% last year, but developing countries stagnated at 0.2%, with South America recording the weakest import growth of any region, owing to the recession in Brazil depressing demand.
The volume of developed economy exports grew by 2.6% in 2015, while exports from developing countries expanded by 3.3%.