With the first estimates of world trade growth in 2015 trickling through, it seems pertinent to dedicate a ‘Chart of the Month’ brief to review what looks to have been a very slow year for international trade growth.
According to Netherlands CPB data, world merchandise trade expanded 2.5% in 2015 in real terms (holding prices of goods constant). This compares to growth of 3.2% in 2014 and 2.4% in 2013.
On the imports side, advanced economies fared reasonably well (growth of 3.6% in 2015), although this was largely down to US imports expanding by 6.2% year-on-year, boosted by the appreciated dollar. According to Bank for International Settlements data, the average value of the dollar (in real terms on a trade-weighted basis) was 10.9% higher in 2015 compared to 2014. The Eurozone (3.4%), Japan (0.2%) and other advanced economies (2.3%) had more modest import growth. It was a terrible year for emerging market imports however, with overall growth at -0.9%. Asia (-2.0%) and Latin America (-0.7%) imports contracted, whereas Africa & Middle East (3.9%) had better growth.
Turning to exports, advanced economies’ growth was weaker (2.1%). The US registered growth of -0.9%, with the Eurozone (2.5%), Japan (2.7%) and other advanced economies (3.4%) doing better. Emerging markets’ growth (4.6%) was stronger, driven by Africa & Middle East (30.2%) and Latin America (10.1%) growth. Like with imports, Asia’s exports growth was also negative (-0.6%).
Looking specifically at sea freight, according to data from Container Trades Statistics, global containerised freight volumes (measured on an import or export basis) grew by just 0.8% in 2015 to 140.4m TEUs. The chart below illustrates that global container volumes picked up to some extent in the final quarter of the year (1.6% growth year-on-year), although this is nothing to get excited about.
For air freight, the picture looks bleaker going in to 2016, at least when inspecting the latest volume growth figures. According to IATA data, although growth was relatively strong in the first quarter of 2015 (as was the case throughout 2014), growth began to slow in the second quarter and has stopped altogether since then. In both Q3 and Q4 2015, year-on-year growth of global international air freight tonnage was -0.1%. Thanks to the growth in the first half of 2015, international air freight tonnage for the whole year grew by 1.8%.
Finally, it is worth making the observation (based on IMF data) that for the fourth consecutive year, global trade growth in real terms was lower than global real GDP growth. The figure cited frequently is that prior to the global recession, trade often grew at as much as twice the rate of GDP. Carriers and forwarders alike must be longing and wondering whether such times will ever return.
Source: Transport Intelligence, March 1st 2016
Author: David Buckby