CNN.com | April 5, 2004
Growth in global trade could reach 7.5 percent this year, assuming the U.S. and European economies continue to expand and oil prices stay near 2003 levels, the World Trade Organization (WTO) says.
The WTO said Monday that a 2.5 percent increase in global output in 2003 had lifted world trade by 4.5 percent.
With economists tipping global GDP growth of 3.7 percent in 2004, trade could grow by 7.5 percent, the Geneva-based trade body said.
But it warned of several risks, including the possibility of slower than expected import growth in the United States and a faltering in demand recovery in Western Europe.
The WTO also noted that while most projections for 2004 assumed a fall in average oil prices, oil markets "have often defied the forecasts."
It said the value of world merchandise trade rose 16 percent last year to $7.3 trillion, while trade in services rose 12 percent to $1.8 trillion.
China underpinned its emergence as a key player on the global trade scene, with its imports growing a remarkable 40 percent in 2003 and exports up 35 percent.
The WTO said these were "unprecedented levels of expansion for a country with such substantial trade volume."
China now ranks No. 3 among importers, behind the United States and Germany, and No. 4 among exporters, behind Germany, the United States and Japan.
"Clearly, the improved economic situation in the United States and Asia has given an important boost to world trade," WTO Director-General Supachai Panitchpakdi said.
But he warned that the pace of trade growth was uneven around the world, and there remained "many barriers" to trade.
Supachai said the best way to overcome these trade distortions was to bring the Doha development agenda to a successful conclusion.
The WTO also said that the main exchange rate development in 2003 was the strengthening of the euro against the dollar.
Germany, with a figure of $748.4 billion, overtook the United States as the world's biggest exporter and accounted for 10 percent of global merchandise exports. It was followed by the U.S. with $724 billion (9.7 percent), Japan $471.9 billion (6.3 percent) and China $438.4 billion (5.9 percent).
Among importers, the United States accounted for $1305.6 billion (16.8 percent), more than twice that of second-placed Germany with $601.7 billion (7.7 percent). China was third on $412.8 billion (5.3 percent), followed by France on $388.4 billion (5.0 percent).
WTO economist Michael Finger said Germany's export surge was due mainly to the decline in the dollar against the euro, but also reflected the continuing demand for specialized machinery, motor vehicles and chemicals from Germany.
"The way things are going, 7.5 percent growth in 2004 -- about twice predicted global GDP growth -- looks to be within reach," WTO Director of Economic Research Patrick Low told a news conference, Reuters reported.
If the 2004 forecast proved correct, Low said, it would mark a return to the pattern of the 1990s when growth averaged 6.5 percent.
He said there was a rocky period in 2001 when it went briefly into overall decline, and in 2002 when it grew only 2.5 percent.CNN.com:
