News
World trade is expected to lose momentum in the second half of 2022 and remain subdued in 2023 as multiple shocks weigh on the global economy. World Trade Organization (WTO) economists now predict global merchandise trade volumes will grow by 3.5% in 2022, slightly better than the 3.0% forecast in April. For 2023, however, they foresee a 1% increase, down sharply from the previous estimate of 3.4%.
In Europe, high energy prices stemming from the Russia-Ukraine war will squeeze household spending and raise manufacturing costs. In the U.S., monetary policy tightening will hit interest-sensitive spending in areas such as housing, motor vehicles and fixed investment. If the downside risks materialize, trade growth in 2023 could then be as low as minus 2.8%. If the surprises are on the upside, however, trade growth next year could be high as 4.6%.
The new WTO forecast estimates world GDP at market exchange rates will grow by 2.8% in 2022 and 2.3% in 2023.
The WTO's current forecast of 3.5% growth in the volume of world merchandise trade in 2022 is close to but slightly stronger than the previous estimate of 3.0% from last April, but the difference is mostly explained by statistical revisions and the availability of new data. The Middle East is expected to record the strongest export growth of any WTO region this year (14.6%), followed by Africa (6.0%), North America (3.4%), Asia (2.9%), Europe (1.8%) and South America (1.6%). In contrast, the CIS exports should decline by 5.8% for the year. The Middle East also had the fastest trade volume growth on the import side (11.1%), followed by North America (8.5%), Africa (7.2%), South America (5.9%), Europe (5.4%), Asia (0.9%) and the CIS (minus 24.7%).
