Up­beat Fore­cast

Beijing Review - - This Week Economy -

The World Trade Or­ga­ni­za­tion (WTO) on Septem­ber 21 re­vised its fore­cast for global trade growth this year to 3.6 per­cent from the pre­vi­ous es­ti­mate of 2.4 per­cent, cit­ing a sharp ac­cel­er­a­tion in global trade growth in the first half of the year.

Ac­cord­ing to WTO economists, stronger growth this year is at­trib­uted to a resur­gence of Asian trade flows, as in­tra-re­gional ship­ments pick up and im­port de­mand in North Amer­ica re­cov­ers af­ter stalling in 2016.

Stronger growth, par­tic­u­larly in China and the United States, has boosted de­mand for im­ports, which spurs in­tra-Asia trade as de­mand is trans­mit­ted through re­gional sup­ply chains, the WTO ex­plained.

Chi­nese de­mand in the first half of 2017 was driven by solid growth in in­dus­try and even stronger growth in ser­vices. Fi­nan­cial con­di­tions in Asia have also im­proved com­pared to the volatile first quar­ter of 2016, con­tribut­ing to busi­ness and con­sumer con­fi­dence, the WTO added.

Mean­while, the WTO noted that the par­tial re­cov­ery of oil prices in 2017 also ap­pears to have pro­vided some sup­port for in­vest­ment in the United States, growth of which slowed abruptly in 2016, par­tic­u­larly in the en­ergy sec­tor, but picked up in the first half of this year.

How­ever, the WTO es­ti­mated that the rapid pace of trade growth this year is un­likely to be sus­tained, while ex­pect­ing mod­er­ate trade growth in 2018 of around 3.2 per­cent.

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