Geneva: Prospects for trade in 2025 are uncertain as they may be affected by possible trade policy shifts as European trade flows continue to decline on both the export and import sides thereby weighing down global trade growth, the World Trade Organization (WTO) warned today.
The latest WTO Goods Trade Barometer released today further showed a “moderate pace” of expansion in global goods trade in the fourth quarter of 2024.
The latest reading of 102.7 for the barometer index (represented by the blue line above) is both above the quarterly trade volume index (represented by the black line) and greater than the baseline value of 100 for the index, suggesting that trade will continue to grow steadily through the fourth quarter.
All of the barometer’s component indices remain on or above trend except for the electronic components index (95.4), which has stabilized below trend. Indices representing export orders and raw materials indices are both on trend (100.5) while those representing air freight (102.9), automotive products (104.0) and container shipping (105.8) are firmly above trend. The container shipping index showed the biggest improvement over the last three months while the air freight index lost momentum. Export orders, usually the most predictive of the barometer’s components, remain very close to the baseline value of 100, suggesting steady trade growth in the near term.
However, WTO stressed that the outlook is clouded by rising economic uncertainty, including possible shifts in trade policy. On October 10, 2024, WTO forecasted that trade volume growth for the whole of 2024 should come in at around 2.7% while growth in 2025 may reach 3.0%. However, it had cautioned that rising geopolitical tensions and increased economic policy uncertainty continue to pose substantial downside risks to the forecast.
– global bihari bureau
