Stronger-than-expected growth in global trade is being driven by rising demand for imports in Asia and North America, the World Trade Organization (WTO) has revealed.
According to the latest estimates from WTO economists, world merchandise trade volume will grow by 3.6% in 2017 rather than by the 2.4% previously forecast. The WTO also sees a rise of 2.8% in global gross domestic product (GDP).
Those forecasts are more positive than earlier ones, thanks to a sharp increase in global trade growth in the first half of the year. Growth of 3.6% would represent a substantial improvement on the lacklustre 1.3% increase in 2016, the WTO points out.
For 2018, trade growth should moderate to 3.2% (within a range from 1.4% to 4.4%) as global GDP growth remains stable at 2.8%.
The WTO warns, however, that the anticipated recovery could be undermined by a number of risks, including trade policy measures (with the danger that protectionist rhetoric translates into trade-restrictive actions), monetary tightening, geopolitical tensions and financially costly natural disasters.
“The improved outlook for trade is welcome news, but substantial risks that threaten the world economy remain in place and could easily undermine any trade recovery,” WTO Director-General Roberto Azevêdo responded.
During the second quarter (Q2) of 2017, GDP growth accelerated in most major economies, notably China which saw growth from 1.3% in the first quarter (Q1) to 1.7% in Q2.
Chinese demand for imports in the first half of 2017 was driven by growth in industry (up 6.4% in real terms for the year to date) and in services (up 7.7% over the same period).
Growth was also recorded in the USA (up from 1.2% annualised in Q1 to 3.0% in Q3) and in the eurozone (up from 2.2% in Q1 to 2.6% in Q2).
