Global commerce will grow 6.5% this year after expanding a record 14.5% in 2010 as economies from China to Brazil recover from the worst recession in six decades, the World Trade Organization said on Thursday.
WTO said it sees a “greater degree of uncertainty to any forecast” for 2011 as growing inflation, unrest in the Middle East and the March earthquake in Japan have “tilted the balance of risk toward the downside.”
Developing economies will lead global trade growth this year, with a forecast 9.5%, compared with 4.5% for developed nations. Commerce expanded an average 6% yearly between 1990 and 2008, the WTO said. It used trade volumes rather than values for its assessment to avoid distortions caused by changes in commodity prices or exchange rates.
“Trade growth is stabilizing at levels that are both more conventional and sustainable,” WTO Director-General Pascal Lamy said at a news conference. He added that “the hangover from the financial crisis is still with us,” urging the trade group’s 153 members to open their markets.
Emerging markets led the world out of the recession triggered by the banking crisis in developed nations, with China replacing Japan as the world’s second-largest economy last year. While most countries have emerged from recessions, the WTO continues to press governments to take steps to stimulate commerce and bolster the global trading system.
Trade forecasts are based on economic growth of 2.2% in developed countries and 5.8% in the rest of the world.
Increasing oil prices are also putting pressure on global trade, the WTO said. With Libyan oil exports halted for an indeterminate period amid the rebellion against Muammar Gaddafi, “an interruption of supplies for any other major producer would raise prices higher still,” the WTO said. “In such an event, the WTO would have to revisit its trade projections.”
Lamy said the Japan crisis forced forecasters into a “slight downgrade from the initial estimates” for the world’s third-biggest economy. Japan’s exports may fall between 0.5% and 1.6% this year, while imports may rise between 0.4% and 1.3%.
The seven biggest emerging markets, led by China and India, will surpass the Group of Seven economies in size in 2032 as the financial crisis accelerates the shift of power in the global economy, PricewaterhouseCoopers LLP said in January.
The WTO predicted last September that global trade would expand 13.5% in 2010, raising its March 2010 forecast of 9.5% growth for the second time. The trade arbiter said on March 14 that the value of world merchandise trade based on current US dollars -- meaning inflation wasn’t taken into account and the figures weren’t seasonally adjusted -- surged 22% last year, returning to pre-crisis levels.
That came after global trade fell more than 12% in 2009, the biggest contraction since World War II. The value of goods traded globally tumbled 23% in 2009 to 12.2 trillion USD and the value of trade in commercial services fell 13% to 3.3 trillion USD, the first year-on-year drop since 1983.