Home / News / Global trade hits record high of $28.5 trillion in 2021, but likely to be subdued in 2022

Global trade hits record high of $28.5 trillion in 2021, but likely to be subdued in 2022

Views: 0     Author: Site Editor     Publish Time: 2022-03-02      Origin: Site

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UNCTAD’s Global Trade Update published on 17 February shows that in 2021, world trade in goods remained strong and trade in services finally returned to its pre-COVID-19 levels.

“Overall, the value of global trade reached a record level of $28.5 trillion in 2021,” the report says. That’s an increase of 25% in 2020 and 13% higher compared to 2019, before the COVID-19 pandemic struck.

While most global trade growth took hold during the first half of 2021, progress continued in the year’s second half.

After a relatively slow third quarter, trade growth picked up again in the fourth quarter, when trade in goods increased by almost $200 billion, achieving a new record of $5.8 trillion.

Meanwhile, trade in services rose by $50 billion to reach $1.6 trillion, just above pre-pandemic levels.

Greater trade growth in developing countries

The report shows that in the fourth quarter 2021, all major trading economies saw imports and exports rise well above pre-pandemic levels in 2019.

But trade in goods increased more strongly in the developing world than in developed countries.

Exports of developing countries were about 30% higher than during the same period in 2020, compared with 15% for wealthier nations.

The growth was higher in commodity-exporting regions, as commodity prices increased. Moreover, South-South trade growth was above the global average, with a 32% year-on-year increase.

Forecasts for 2022

The UNCTAD report indicates that trade growth will slow during the first quarter of 2022.

Positive growth rates are expected for both trade in goods and services, albeit only marginally, keeping trade values at levels similar to the last three months of 2021.

“The positive trend for international trade in 2021 was largely the result of increases in commodity prices, subsiding pandemic restrictions and a strong recovery in demand due to economic stimulus packages,” the report says.

“As these trends are likely to abate, international trade trends are expected to normalize during 2022.”

Factors set to shape 2022 world trade

Trade growth in 2022 is likely to be lower than expected, given the macroeconomic trends.

The International Monetary Fund has revised its world economic growth forecast downwards by 0.5 points, the report notes, considering persistent inflation in the United States and concerns related to China’s real estate sector.

It also points to ongoing logistic disruptions and rising energy prices, saying that “efforts to shorten supply chains and to diversify suppliers could affect global trade patterns during 2022.”

                                                   Source: www.hellenicshippingnews.com


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