Global merchandise trade is poised for a significant rebound in 2024, with the World Trade Organization (WTO) forecasting a 2.6% increase in its annual trade statistics and outlook report published on Wednesday.
This anticipated growth comes after a 1.2% decline in world trade volume in 2023, attributed to the lingering effects of high energy prices and persistent inflation.
The WTO report highlights a gradual pickup in global trade beginning in 2024, as inflationary pressures are expected to ease, allowing real incomes to rise and boosting consumption of manufactured goods. “A recovery of demand for tradable goods in 2024 is already evident, with indices of new export orders pointing to improving conditions for trade at the start of the year,” the report noted.
WTO Director-General Ngozi Okonjo-Iweala expressed optimism, stating, “We are making progress towards global trade recovery, thanks to resilient supply chains and a solid multilateral trading framework, which are vital for improving livelihoods and welfare.”
She emphasized the importance of mitigating risks such as geopolitical strife and trade fragmentation to maintain economic growth and stability.
The report forecasts robust growth in specific regions, with Africa’s exports expected to grow by 5.3% in 2024, the fastest among all regions. Additionally, strong import volume growth of 5.6% in Asia and 4.4% in Africa is anticipated to bolster global demand for traded goods.
While the economic impact of disruptions such as the recent Middle East conflict on critical shipping routes like the Suez Canal has been relatively limited so far, certain sectors—including automotive products, fertilizers, and retail—have already been affected by delays and increased freight costs.
The WTO report also addresses concerns regarding geopolitical tensions and their effect on global trade patterns. It notes that while such tensions have marginally impacted trade, they have not triggered a sustained trend toward de-globalization. “Some governments have become more skeptical about the benefits of trade and have taken steps aimed at reshoring production and shifting trade towards friendly nations,” remarked WTO Chief Economist Ralph Ossa.
Furthermore, the resilience of trade is being tested by disruptions in other critical maritime routes such as the Panama Canal and the Red Sea, which are experiencing challenges that could affect global shipping.
Looking ahead, the WTO estimates that global GDP growth at market exchange rates will remain mostly stable over the next two years, at 2.6% in 2024 and 2.7% in 2025, underpinning the anticipated recovery in trade volumes.
As Asia continues to play a pivotal role in global trade dynamics, stakeholders across the region—including business professionals, investors, and policymakers—are closely monitoring these developments to capitalize on emerging opportunities and navigate potential challenges in the international trading landscape.
Reference(s):
cgtn.com
