WTO says trade in goods slows due to supply issues and colder demand
GENEVA (Reuters) – Global merchandise trade slows after a sharp rebound from the initial shock of the COVID-19 pandemic, production and supply disruptions and cooling import demand slowing growth, the World Trade Organization said on Monday.
The WTO said its merchandise trade barometer fell to 99.5 points, close to the baseline of 100, in November after a record 110.4 points in August.
The Geneva-based trade body said supply shocks, including port congestion resulting from increased import demand in the first half of the year and disruption in the production of goods such as automobiles and semi. -conductors, had contributed to the decline.
Demand for traded goods also slowed, as evidenced by falling export orders.
“Cooling import demand could help alleviate port congestion, but backlogs and delays are unlikely to be eliminated as long as container throughput remains at or near record levels,” said the WTO.
The WTO said the reading was broadly in line with its forecast of a 10.8% recovery in merchandise trade volume this year, slowing to a 4.7% increase in 2022.
The WTO said the outlook for world trade continued to be overshadowed by downside risks, regional disparities and continued weakness in trade in services.
The Geneva-based trade body said all component indices on its barometer had fallen, with the largest drop for its automotive products index and only the air freight index significantly above trend.
Electronic components, container transport and raw materials reached or close to the 100 mark, indicating growth in line with medium-term trends.
The WTO Merchandise Trade Barometer is a composite of data and is designed to anticipate turning points and assess the momentum of global trade growth rather than providing a specific short-term forecast.
Reporting by Philip Blenkinsop; Editing by Chizu Nomiyama