WTO predicts a 3.3% increase in global commodity trade volume in 2024

Source: 5688.cn

The latest "Global Trade Outlook and Statistics - October 2023 Report Update" released by the World Trade Organization predicts that based on the sustained downturn starting from the fourth quarter of last year, WTO economists have lowered their forecasts for global commodity trade growth in 2023. It is expected that the world commodity trade volume will grow by 0.8% in 2023, less than half of the predicted growth rate of 1.7% in April. The expected growth rate in 2024 is 3.3%, which is almost unchanged from previous estimates.

The WTO predicts that based on market exchange rates, world GDP will actually grow by 2.6% in 2023 and 2.5% in 2024.

The WTO outlined the main macroeconomic trends in the above-mentioned report, pointing out that world trade and production suddenly slowed down in the fourth quarter of 2022, mainly due to the impact of sustained inflation and monetary policy tightening in the United States, the European Union, and other regions, coupled with the ongoing military conflict between Russia and Ukraine, which has cast a shadow on the global trade prospects. There are widespread signs of trade slowdown, involving many countries and various commodities.

Looking ahead, the WTO predicts that trade growth will accelerate next year, while GDP growth will be slow but stable. As inflation slows and interest rates begin to decline, industries that are more sensitive to the business cycle may stabilize and rebound. However, signs of supply chain fragmentation are beginning to emerge, which may have a certain impact on the relatively positive outlook for 2024. WTO Director General Ngozi Okonjo Iweala stated that global economic fragmentation will only make the economy worse, and WTO members must seize the opportunity to strengthen the global trade framework by avoiding protectionism and cultivating a more resilient and inclusive global economy. Without a stable, open, predictable, rule-based, and fair multilateral trading system, the global economy, especially poor countries, will find it difficult to recover.

WTO Chief Economist Ralph Ossa added that the data does show some trends in economic fragmentation, reflecting the relationship with geopolitical tensions. Fortunately, a broader phenomenon of de globalization has not yet emerged. The data indicates that goods continue to be produced through complex supply chains, but the scope of these supply chains may have stabilized in the short term. The WTO points out that the world trade in commercial services is not within the scope of the aforementioned report's predictions. However, preliminary data suggests that growth in the transportation and tourism industries may be slowing down after a strong rebound last year.

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