TRADE: Merchandise Trade Up, Despite Oil Price Impacts

By Gustavo Capdevila Reprint | | Print |

Gustavo Capdevila

GENEVA, Dec 2 2000 (IPS) - The “soft landing” of the United States economy and the deceleration in Western Europe due to rising oil prices have led to predictions that international merchandise trade will expand by just under seven percent in 2001.

The rise next year will be slightly more than the 6.5 percent growth recorded throughout the 1990s, though below this year’s expansion, calculated at 10 percent.

The first nine months of 2000 saw an even higher level: 14 percent expansion worldwide. The lower rate projected for the year’s average – 10 percent – obeys the predicted soft landing of the US economy and the increase in petroleum prices for the final quarter.

These trends form the basis of “International Trade Statistics 2000,” a report published this week by the World Trade Organisation (WTO).

The report indicates that the fiasco of the WTO Ministerial Conference held last December in the US city of Seattle, which killed efforts to launch a new round of multilateral talks, did not slow world trade.

The study contains the final data on last year’s trade performance as well as summaries on the first nine months of 2000. WTO chief of economic research Michael Finger offered some projections for the full year during his presentation of the text Thursday in Geneva.

In 1999, the value of world goods exports rose 3.5 percent, reaching 5.47 trillion dollars, and exports in services increased 1.5 percent to 1.35 trillion.

The value of negotiated goods this year could reach nearly 6.9 trillion dollars, Finger said.

Finger denied that trade in 2000, which grew twice as much as in 1999, had suffered the impacts of the failed WTO ministerial conference in Seattle.

With the collapse of that meeting, the chances evaporated for the immediate convening of new negotiations to deepen liberalisation of the world economy, as industrialised nations are demanding.

In the first nine months of 2000, US exports rose 15 percent and imports 19 percent. In Western Europe, meanwhile, exports increased 3.5 percent and imports six percent. Russia saw 49 and 11 percent growth, respectively.

For the same period, the Asian region recorded an export increase of 23 percent, while imports rose 28 percent. China’s export and import growth was 33 and 39 percent, respectively, Japan saw 21 and 25 percent, while the rise was 23 and 32 percent in the five countries of Southeast Asia.

Growth in Latin America was 23 percent for exports and 19 percent for imports. Mexico had a balanced 24 percent for each, while Brazil recorded an 18 percent rise in exports and 14 percent in imports.

In general, the news coming from all regions has been good. “The United States is still a locomotive force, but it is no longer alone,” said Finger, adding that despite its diminished role, US trade continues to grow faster than the rest of the world.

The WTO expert underscored this year’s economic recovery in Western Europe, Japan, Asia and Latin America. The report’s data on Africa for 1999 indicate that the continent’s economic expansion stabilised at three percent.

The evolution of prices for basic products continues to deeply affect the pace of merchandise trade in Africa, according to “International Trade Statistics 2000.”

The prices of fuel exported by the continent rose 25 percent in 1999, but a new two-digit drop in basic goods prices produced a decline in exports of African agricultural products.

Fuel trade rose 19 percent to reach 400 billion dollars in 1999, when prices shot up 30 percent, allowing a recovery of half the income losses Africa suffered in 1998.

But the fluctuation of petroleum prices in 2000 reached an unprecedented margin of 90 percent, according to Finger. Due to this phenomenon, the value of Russian exports rose 50 percent in the first nine months of 2000.