   
  
PRESS/ 840 
 
1 October 2019  
(19-6264) Page: 1/7 
   
 
PRESS RELEASE  
E M B A R G O  
N O T  F O R  P U B L I C A T I O N ,  O R  D I S T R I B U T I O N  B Y  N E W S  A G E N C I E S  U N T I L  
1 1 : 0 0  G E N E V A  T I M E  1  O C T O B E R  2 0 1 9  
 
TRADE STATIST ICS AND OUTLOOK  
WTO lowers  trade forecast  as tension s unsettle global economy  
Escalating trade tensions and  a slowing global economy have led WTO economists to sharply  
downgrade their forecasts for trade growth in 2019 and 2020.  World merchandise trade volumes 
are now expected to rise by only 1.2%  in 2019 , 
substantially slower than the 2.6% growth forecast 
in April . The projected increase in 2020 is now 
2.7%, down from 3.0% previously. The economists 
caution that downside risks re main high and that 
the 2020 projection depend s on a return to more 
normal trade relations .  
 
“The darkening outlook for trade is discouraging 
but not unexpected. Beyond their direct effects, 
trade conflicts heighten uncertainty, which is 
leading some busin esses to delay the productivity -
enhancing investments that are essential to raising 
living standards," said WTO Director -General 
Roberto Azevêdo. "Job creation may also be 
hampered as firms employ fewer workers to 
produce goods and services for export."  
 
"Resolving trade disagreements would allow WTO 
members to avoid such costs," the WTO Director -
General added. "The multilateral trading system 
remains the most important global forum for 
settling differences and providing solutions for the 
challenges of the 21st century global economy. 
Members should work together in a spirit of 
cooperation to reform the WTO and make it even 
stronger and more effective.”  
 
The updated trade forecast is based on consensus 
estimates of world GDP growth of 2.3% at market 
MAIN POINTS  
•World merchandise trade volume 
is forecast to grow 1.2% in 2019 . 
This is substantially below the 2.6% 
trade growth that had been projected 
in April.   
•Trade volume growth should 
accelerate slightly to 2.7% in 2020  
while global GDP growth holds  steady 
at 2.3%  (at market exchange rates) , but 
this depends on an easing of trade 
tensions.  
•Trade conflicts pose the biggest 
downside risk to the forecast  but 
macroeconomic  shocks  and financial 
volatility  are also potential tr iggers for a 
steeper downturn.  
•Trade -related indicators signal a 
worrying trajectory  for world trade 
based on global export orders and 
economic policy uncertainty.  
•Export and import growth slowed 
across all regions  and at all levels of 
development in the first half of 2019.   PRESS/ 840 
 
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  exchange  rates for  both 2019 and 2020, down from 2.6% previously. Slowing economic growth is 
partly due to rising trade tensions but also reflects country -specific cyclical and structural factors, 
including the shifting  monetary policy  stance in developed economie s and Brexit -related 
uncertainty  in the European Union. Macroeconomic risks are firmly tilted to the downside.  
 
Due to the high degree of uncertainty associated with trade forecasts  under current conditions, the 
estimated  growth rate for world trade in 201 9 is placed within a range of 0.5% to 1.6%. Trade 
growth could fall below  this range if trade tensions continue to build , or outperform it  if they start 
to recede . The range of likely values is wider for 2020, ranging from 1.7% to 3.7%, with better 
outcome s depending on an easing of trade tensions.  
 
Risks to the forecast are heavily weighted to the downside  and dominated by trade policy . Further 
rounds of tariffs and retaliation could produce  a destructive cycle of recrimination . Shifting  
monetary and fiscal policies could destabilize  volatile financial market s. A sharper  slowing of the 
global economy could produce an even bigger downturn in trade. Finally, a  disorderly Brexit could 
have a significant regional  impact, mostly confined to Eur ope.  
Chart 1: World merchandise exports and imports by level of development, 2012Q1 -
2019Q2  
Volume index, 2012Q1=100  
Source:  WTO and UNCTAD.  
Charts 1 and 2 show quarterly merchandise  export and import  volume s on a seasonally -adjusted 
basis by level of development and geographic region. In the first half of 2019, world merchandise 
trade was up 0.6% compared to the same period in the previous year . This marks a substantial 
slowdown compared to recent years. Exports of developed economies were up just  0.2%  for the 
year-to-date, while those  of developing economies were up  1.3%. On the import side, developed 
economies recorded year -on-year growth of 1.1% while developing countries declin ed by  0.4%.  
Growth rates based on quarterly data may differ slightly from calculations based on annual 
statistics , but they should be of similar magnitude.   
 
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  Chart 2: Merchandise exports and imports by region, 2012Q1 -2019Q2 
Volume index, 2012Q1=100  
 
1  Refers to South and Central America and the Caribbean.  
2  Other regions comprise Africa, Middle East and the Commonwealth of Independent States, including 
associate and former member States.  
Source:  WTO and UNCTAD.  
 
All geographical regions recorded positive year -on-year export  growth in the first half of 2019  
despite a substantial weakening of global demand . North America had the fastest export growth of 
any region at 1.4%, followed by South America at 1.3%, Europe at 0.7% , Asia at 0.7% , and Other 
regions (comprising Africa, the Middle East and the Commonwealth  of Independent States , 
including associate and former member States) at 0.1%.  
 
North America  recorded  the fastest import growth of any single region at 1.8% , followed by 
Europe at 0.2%. Two regions registered  declines (South America at  -0.7% and Asia at -0.4% ). 
Collectively, the  imports of Other regions grew faster  than those  of North America,  at 2.4%.  
Import demand has been particularly weak in Asia, weigh ing heavily on exporters of manufactured 
goods (e.g. Japan, Korea , and Germany) . Exporters  of natural resources  have also seen demand 
for their products  weaken , as evidenced by the 12% year-on-year decline in commodity prices  in 
August.  
 
There are no comprehensive statistics on services trade in volume terms due to the general 
unavailability of pri ce data, but an approximate measure of services trade  volume  can be derived 
by adjusting nominal commercial services trade statistics to account for exchange rates and 
inflation . This index  shows that , like merchandise trade,  commercial services trade has plateaued  
recently  (Chart 3) . 
 
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  Chart 3: World services trade activity index , 2015Q1 – 2019Q2  
Index, 2015=100 
 
Source:  WTO and UNCTAD , United States Federal Reserve, Bank for International Settlements and 
Secretariat calculations.  
Monthly economic indicators provide some  worrying  clues about the current and future trajectory 
of world trade. A n index of new export orders derived from pur chasing man agers' indices has 
fallen from 54. 0 in January  2018 to 47.5 in August  2019, the weakest reading since October 2012 
(Chart 4). Note that values below 50.0 signal contraction.  
 
Chart 4: Global PMI new export orders index, Jan. 2010 – Aug. 2019  
Index, base=50  
 
Note:  Values greater than 50 indicate expansion while values less than 50 denote contraction.  
Source:  IHS Markit.  
A separate indicator based on the frequency of  phrases  in press reports captures aspects of 
monetary, fiscal and trade polic y uncertainty  (Chart 5). In 2019 , the index has risen  from 289  in 
January  to 348 in August, its highest level  ever. To the extent that economic uncertainty deters 9095100105110115120
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  investment , it can have a disproportionately negative effect  on trade since capital goods  that make 
up investments  tend to have high import content.  
 
Chart 5: Global economic policy uncertainty, Jan. 2005 – Aug. 2019  
(index, average 1997 -2015=100)  
 
Source:  PolicyUncertainty.com.  
Monthly merchandise trade values in current US dollar terms are shown for selected economies in 
Chart 6 below.  Some countries (e.g. the United States  and China) may  show signs of a turnaround 
while others (the Republic of Korea and Japan) provide no such indication. Nominal trade statistics 
are strongly influenced by prices and exchange rates , so these trends  should be interpreted  with 
caution.  
 
If current GDP estimates  are realised , the volume of world merchandise trade should increase by  
1.2% in 2019  (Table 1) , but this would require  a degree of recovery in the second half of the year. 
Monetary easing in developed countries has not had a major impact to date  but is likel y to be felt 
toward the end of  2019 and into 2020. Other measures, including fiscal polic ies for surplus 
countrie s, are being undertaken to stem the current  slowdown . These measures could provide 
some upside potential to the forecast , especially if outstan ding trade disputes are  resolved . 
However, the balance of risk remains on the downside, with trade disputes, financial volatility and 
geopolitical  tensions providing potential triggers  for a steeper downturn.   
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  Table 1: Merchandise trade volume and real GDP, 2015 -20201 
Annual % change  
 
1 Figures for 201 9 and 20 20 are projections.  
2 Average of exports and imports.  
3 Includes the Commonwealth of Independent States (CIS), including associate and former member 
States.  
4 Refers to South and Central Ameri ca and the Caribbean.  
5 Other regions comprise Africa, Middle East and Commonwealth of Independent States (CIS).  
Source:  WTO and UNCTAD for trade, consensus estimates for GDP.  
 
2015 2016 2017 2018 2019P 2020P
Volume of world merchandise trade22.3 1.7 4.6 3.0 1.2 2.7
Exports
Developed economies 2.4 1.0 3.6 2.1 0.4 2.2
Developing economies31.7 2.3 5.6 3.5 2.1 3.4
North America 1.1 0.3 4.2 4.3 1.5 3.6
South and Central America4-0.4 0.7 3.0 0.6 1.3 0.7
Europe 2.9 1.2 3.7 1.6 0.6 1.7
Asia 1.4 2.3 6.8 3.8 1.8 3.8
Other regions53.2 2.9 1.6 2.7 0.9 2.5
Imports
Developed economies 4.2 2.0 3.3 2.5 1.6 1.2
Developing economies30.6 1.3 6.8 4.1 1.1 4.3
North America 5.4 0.1 4.0 5.0 2.9 2.1
South and Central America4-8.4 -8.8 4.6 5.2 -0.7 4.5
Europe 3.5 3.1 2.9 1.1 0.4 0.9
Asia 3.9 3.6 8.3 5.0 1.3 3.9
Other regions5-4.3 -1.9 2.5 0.5 2.6 4.3
Real GDP at market exchange rates 2.8 2.4 3.0 2.8 2.3 2.3
Developed economies 2.3 1.6 2.3 2.2 1.7 1.4
Developing economies33.7 3.8 4.3 4.1 3.4 3.8
North America 2.7 1.6 2.3 2.7 2.2 1.9
South and Central America4-0.8 -2.0 0.7 0.6 0.1 2.4
Europe 2.4 2.0 2.7 2.0 1.3 1.2
Asia 4.3 4.2 4.6 4.2 3.9 3.5
Other regions51.2 2.4 2.0 2.2 1.7 2.4PRESS/ 840 
 
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  Chart 6 : Merchandise exports and imports of selected economies, January 2014 -July 
2019  
(Billion dollars)  
 
Source:  IMF International Financial Statistics, Global Trade Information Services GTA database, national 
statistics.  
END 
Chart 5
Merchandise exports and imports of selected economies, January 2014-July 2019
(Billion dollars)
Sources: IMF International Financial Statistics, Global Trade Information Services GTA database, national statistics.India Russian FederationUnited States European Union (extra-trade)
Japan Republic of Korea
Brazil China050100150200250300
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