'..prospects for world trade and output are better than they have been for some time, which make it a great time for UK companies to consider exporting to new markets.'
There has been lots of positivity around trade and it’s only getting better. With Britain dubbed as the fastest growing major economy this year, according to the International Monetary Fund last week, there is definitely a wave of optimism in the air for British exporters.
The latest Quarterly Economic Survey for Q1 2014 data shows that service sector exports are at a new all time high. Both export balances in the services sector rose in Q1, surpassing their Q4 all-time highs: export sales (+38%) and export orders (+39%). In addition, the World Trade Organisation (WTO) has raised its forecasts for world trade for 2014, but says it does not expect a return to its historic high until next year at the earliest. However, prospects for world trade and output are better than they have been for some time, which make it a great time for UK companies to consider exporting to new markets. Read my global trade round up of the latest forecasts. For the latest market intelligence, visit the Export Britain Market Snapshots.
Performance in 2013
World merchandise trade volume as measured by the average of exports and imports rose 2.1% in 2013.
Asia’s exports grew faster than any other region’s last year, with a 4.6% rise. Followed by North America (2.8%), Europe (1.5%), the Middle East (also 1.5%), South and Central America (0.7%) and Africa (-3.4%). For imports, the fastest growing region was Asia (4.4%), followed by the Middle East (4.4%), Africa (4.0%), South and Central America (2.5%), North America (1.2%) and Europe (-0.5%).
In 2013, the top five merchandise exporters were China, the US, Germany, Japan and the Netherlands, and the leading importers were the US, China, Germany, Japan and France. As for commercial services, the top five exporters last year were the US, Britain, Germany, France and China, and top five importers were the US, China, Germany, France and the UK. China replaced Germany as the second largest importer of commercial services.
The WTO’s forecast of 4.7% growth is below the average rate of 5.3% for the last 20 years (1993–2013) and also below the pre-crisis average rate of 6.0% for 1990–2008. The divergence between the pre-crisis trend and current levels of world trade continues to widen.
Exports from Asia will grow faster than those from any other region (6.9%). This is followed by North America (4.6%), South and Central America (4.4%), Europe (3.3%). Exports will be supported by rising import demand on the part of developed countries as the US economy gains momentum, and by improving economic conditions in Europe.
On the import side, the 4.7% increase in world trade in 2014 will be split between developed economies growing at 3.4%, and developing economies growing at 6.3%. Asia should also lead all regions in import growth in 2014 (6.4%), followed by South and Central America (4.1%), North America (3.9%), and finally Europe (3.2%).
Sukhdeep Dhillon is the BCC's Global Economic Adviser. For all the latest news from Sukhdeep, follow @SukiDil