- Annual growth refers to the last four quarters.
- Remarkable yet uneven Although the services sector picked up in line with the overall growth, trade in services, such as tourism, will remain slightly below pre-pandemic levels at $6 trillion in 2021.
- The report also highlights the risk of a continued shortage of semiconductors.
According to a UNCTAD report released on November 30, the value of global goods imports and exports in the third quarter of 2021 hit $5.6 trillion, a new quarterly high.
New predictions
According to new predictions published in the November issue of the organization’s Global Commerce Update, global trade in goods and services would reach $28 trillion this year, up 23% in 2020 and 11% higher than pre-COVID-19 levels.
However, the research claims that trade’s overall robust performance hides the fact that recovery has been unequal between countries and sectors.
“The significant recovery in demand due to decreasing pandemic restrictions, economic stimulus packages, and increases in commodity prices is essentially the result of the favourable trend for international commerce in 2021,” it states.
It also warns that the outlook for 2022 is still very hazy.
Remarkable yet uneven
Although the services sector grew in tandem with the general economy, service trade, such as tourism, will stay somewhat below pre-pandemic levels in 2021, at $6 trillion.
Energy-related product trade rose the highest among manufacturing sectors, boosted by high demand for and price rises in fossil fuels.
Meanwhile, commerce in several industries affected by the global scarcity of semiconductors, such as the automobile industry and electronics, slowed in the third quarter of 2021.
In the third quarter of 2021, regional trade growth remained unequal, while the regional inequalities were less pronounced than in the first half of the year.
According to the research, trade flows continued to expand more rapidly for developing countries than for established economies, indicating that this pattern had become more widespread.
“While strong trade growth in East Asian emerging nations drove this trend in previous quarters, it has broadened across developing countries in Q3 2021,” the report states.
Uncertainty ahead
China’s “below expectations” growth in the third quarter of 2021 is one of the causes contributing to anxiety about next year, according to the research.
“Lower-than-expected economic growth rates are often reflected in more pessimistic global trade trends,” the report adds, while also mentioning “inflationary pressures” that could harm national economies and international trade flows.
As regional commerce within Africa and the Asia-Pacific region grows, geopolitical issues may play a role in shifting trade patterns, “diverting trade away from other channels.”
The paper also emphasises the dangers of a continuing semiconductor shortage.
“Since the outbreak of the COVID-19 pandemic, the semiconductor industry has been buffeted by sudden demand spikes and persistent supply limitations… If the scarcity persists, it will have a detrimental impact on production and trade in many manufacturing sectors.”
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Source: UNCTAD
