The World Trade Organization (WTO) has updated its projections on the growth of world merchandise trade, The country is expected to expand by 2,7% in 2024, slightly higher than the 2,6% previously forecast. Growth of 2025% is expected in 3,0, although this is lower than the 3,3% forecast in previous revisions.
As to global economic growth, the WTO estimates that global real GDP will remain stable at 2,7% annually between 2023 and 2025. Asia is positioned as the most dynamic region, with projected growth of 4,0% for 2024. In contrast, Europe shows signs of slowing down, with anticipated growth of only 1,1%. The case of Germany is particularly relevant, given that its GDP registered a slight contraction in the second quarter of this year.
Despite the increase in the volume of world trade, value of goods In US dollars, the price of crude oil remained stable in the first half of 2024, due to a 2,6% drop in export and import prices. In this regard, some Asian economies recorded strong increases in exports and imports, such as Vietnam (16% and 18%) and Singapore (6% and 9%). In contrast, economies in South America and Europe saw declines, especially in imports: Argentina (-26%) and Germany, (-6%). The largest contraction in exports occurred in Bolivia (-21%). On the other hand, the trade in services has experienced more robust growth, with an 8% increase in the first quarter, with the travel category standing out, which had a notable increase of 19%.
The WTO says that by mid-2024, the inflation had eased enough for central banks to begin cutting interest rates. This shift is expected to boost household incomes and encourage more spending by consumers, while businesses could increase their investments, benefiting from lower financing costs.
However, the WTO warns that such results could be less favourable than projected due to regional conflicts, geopolitical tensions and global political uncertainty. An escalation of the conflict in the Middle East could have serious repercussions on the maritime transport and in energy prices, given the region's importance in oil production.
Additionally, the WTO report analyzes how these geopolitical tensions have affected the global value chains, especially the trade in intermediate goods as parts and accessories in sectors such as electronics and machinery. The trade war between China and the US, exacerbated by the conflict in Ukraine, has led to two major contractions in trade relations, despite a temporary recovery in 2020. In this context, the report highlights the growing role of Mexico and Vietnam as “link economies” in supply chains to the US.
To mark the 30th anniversary of the Marrakech Agreement, the WTO highlights the positive impact of international trade, which has increased fivefold in volume and contributed to a significant reduction in global poverty. In this period, incomes in low- and middle-income economies have tripled and global per capita income has increased by 65%. Despite current geopolitical tensions, the WTO reaffirms its role in promoting open and predictable trade. It also calls for “strengthen cooperation» in digital and sustainable technologies to further boost the development of emerging economies and foster inclusive growth. (Report “World Trade Outlook and Statistics")
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