WTO: Trade growth to remain strong

CNC
Added On April 14, 2018

The World Trade Organization says the world can look forward to at least two more years of strong trade growth.
 
Although that might be threatened by the ongoing trade tensions.  
 
Last year, world merchandise trade growth hit its highest level for seven years.
 
According to the WTO, that upturn will continue until at least 2019.
 
SOUNDBITE (English):ROBERTO AZEVEDO, Director-General of WTO
"In 2017, trade growth was very strong. The volume of world merchandise trade grew by 4.7 percent. Economic growth is synchronized across regions, and that is very important. When all of these cylinders are aligned and firing together, the engine performs much better."
 
Despite the optimistic outlook, there are signs that escalating trade tensions could already be affecting business confidence and investment decisions - potentially jeopardizing future growth.
 
SOUNDBITE (English):ROBERTO AZEVEDO, Director-General of WTO
"It is not possible to accurately map out the effects of a major escalation, but clearly they could be serious. There are still a number of measures that have been announced but not implemented. There are conversations and dialogues ongoing between these players that you just mentioned. That's technically. Politically I think we might be seeing the beginning of that."
 
With the world economy becoming more interconnected, the Director-General warned that problems can quickly spread. In those situations - it's the poorer countries who can lose the most.
 
SOUNDBITE (English):ROBERTO AZEVEDO, Director-General of WTO
"If we do see the rise in tensions and these threats being announced here and there, the probability is that the volatility of markets is going to accentuate. The unpredictability of investments, for example, is going to have a dampening effect on economic growth and on job creation. And that's what concerns us. And we hope that we tone that down as much as we can."
 
The WTO anticipates merchandise trade volume growth to fall back to around 4.4 percent this year. 
 
It will then fall again to 4 percent in 2019 - far below its long-term average - but well above the 3 percent typically seen since the financial crash.