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WTO raises 2017 growth forecast as global trade accelerates
THE World Trade Organization (WTO) has revised upwards its forecast for growth in world merchandise trade volume in 2017 to 3.6 per cent, up from its previous estimate of 2.4 per cent. The recovery of Asian trade flows as intra-regional shipments picked up and an uptick in import demand in North America were the reasons given for upgrading its forecast.
According to the WTO, the previous estimate was set within a range of 1.8 per cent to 3.6 per cent, "reflecting the high level of economic and policy uncertainty." The estimate range for global trade growth has been adjusted to between 3.2 per cent and 3.9 per cent, reported American Shipper.
Even at the lower end of the spectrum, 3.2 per cent growth would represent a significant improvement over the 1.3 per cent rise in world trade volume in 2016.
"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," warned WTO director-general Roberto Azevedo.
"These risks include the possibility that protectionist rhetoric translates into trade restrictive actions, a worrying rise in global geopolitical tensions and a rising economic toll from natural disasters. Though difficult to quantify, these risks are very real. As a result, increased optimism about trade should be tempered with a healthy dose of caution.
"On the other hand, the fact that trade growth is now more synchronized across regions than it has been for many years could make the current expansion self-reinforcing," he added.
"Such a positive outcome would be more likely if countries continue to resist the temptations of protectionism and work together with their partners in the multilateral system to ensure that gains from trade are both large and widely shared."
According to the WTO, the previous estimate was set within a range of 1.8 per cent to 3.6 per cent, "reflecting the high level of economic and policy uncertainty." The estimate range for global trade growth has been adjusted to between 3.2 per cent and 3.9 per cent, reported American Shipper.
Even at the lower end of the spectrum, 3.2 per cent growth would represent a significant improvement over the 1.3 per cent rise in world trade volume in 2016.
"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," warned WTO director-general Roberto Azevedo.
"These risks include the possibility that protectionist rhetoric translates into trade restrictive actions, a worrying rise in global geopolitical tensions and a rising economic toll from natural disasters. Though difficult to quantify, these risks are very real. As a result, increased optimism about trade should be tempered with a healthy dose of caution.
"On the other hand, the fact that trade growth is now more synchronized across regions than it has been for many years could make the current expansion self-reinforcing," he added.
"Such a positive outcome would be more likely if countries continue to resist the temptations of protectionism and work together with their partners in the multilateral system to ensure that gains from trade are both large and widely shared."
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