Goods, service sectors fuel positive Q1 2024 global trade
Omeiza Bilal
Global trade trends turned positive in the first quarter of 2024, with the value of trade in goods increasing by around 1 per cent quarter-over-quarter and services by about 1.5 per cent, the United Nations Trade and Development (UNCTAD) has said.
In its Global Trade Update (July 2024), UNCTAD stated that thesurge, fueled by positive trade dynamics for the United States and developing countries, particularly large Asian developing economies, is expected to add approximately $250 billion to goods trade and $100 billion to services trade in the first half of 2024 compared to the second half of 2023.
Global forecasts for GDP growth remain at around 3 per cent for 2024, with the short-term trade outlook being cautiously optimistic. If positive trends persist, global trade in 2024 could reach almost $32 trillion, yet it is unlikely to surpass its record level seen in 2022.
According to the report, “global trade growth in the first quarter of 2024 was primarily driven by increased exports from China (9%), India (7%) and the US (3%). Conversely, Europe’s exports showed no growth and Africa’s exports decreased by 5 per cent.
“Trade in developing countries and South-South trade increased by about 2% in both imports and exports during the first quarter. In comparison, developed countries saw flat imports and a modest 1% rise in exports.
“On an annual basis, however, South-South trade fell by 5% when comparing the first quarter of 2023 to the first quarter of 2024.”
The UN agency noted that trade growth varied significantly across sectors, with green energy and AI-related products experiencing stronger increases.
The trade value of high-performance servers rose by 25 per cent compared to the first quarter of 2023, while other computers and storage units saw an 8 per cent increase. The trade value of electric vehicles also grew significantly, increasing by about 25 per cent,” it said in the report
UNCTAD in the report noted that despite these positive trends, “the outlook for 2024 is tempered by potential geopolitical issues and industrial policy impacts. Geopolitical tensions, rising shipping costs, and emerging industrial policies could reshape global trade patterns.”
The report warns that an increasing focus on domestic industries and trade restrictions could hinder international trade growth.
