Deceleration with acceleration – Monitoring of world trade

The volume of world trade in goods in 2023 will grow by 1.7%, and further growth will accelerate to 3.2% in 2024, the World Trade Organization (WTO) expects. The previous, October, forecast of the organization for 2023 assumed a smaller growth – by 1%.

However, the new forecast also means a slowdown in trade growth. Last year, the indicator grew by 2.7%, while in the first three quarters, the average growth was 4.2%, but in the fourth quarter, the volume of trade fell by 2.4%.

However, the actual growth in trade in 2022 was higher than the pessimistic forecasts, which described the fragmentation of world trade and its breakup into separate blocks, predicted.

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The decline in trade in the fourth quarter of 2022 in the WTO is associated with the negative impact on demand of high energy and food prices, as well as lockdowns in China (when exports from this country decreased by 6.5%).

In monetary terms, global trade rose 12% last year to $25.3 trillion, supported by higher commodity prices. Trade in fuel increased by 61%, agricultural products – by 11%, and industrial goods – by 7%.

The volume of trade in services increased by 15% to $6.8 trillion (digital services accounted for almost half of the total – $3.82 trillion). The greatest volatility was noted in gas prices, but by the end of the year, their index fell to the level of August 2021.

In the future, the expansion of LNG trade can smooth out the difference in gas prices between regions of the world, but so far there is not enough appropriate infrastructure for this, the WTO notes. The cost of food for the year increased by 18%, including for grain – by 21% (for wheat – by 44%). Prices for fertilizers rose noticeably – by 63%.

The WTO expects that the imports of the CIS countries this year may grow by 14.9% after a decline of 13.5% in 2022. In the second quarter of last year (the first months of the conflict in Ukraine), the decline in imports amounted to 20.4% at once, but the recovery in supplies in the second half of the year was faster than expected.

Exports from the CIS countries may grow by 2.8% after a decline of 4.9%. In general, the problems of trade that were noted after the pandemic are considered resolved in the WTO – this is evidenced by the reduction in both delivery times and stocks of finished products.

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