PRESS/ 822 
 
27 September 2018  
(18-5957) Page: 1/6 
    
 
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  27 S E P T E M B E R  2 0 1 8  
 
TRADE STATISTICS AND  OUTLOOK  
WTO downgrades outlook for global trade as risks accumulate  
Escalating trade tensions and tighter credit market conditions in important markets will slow trade 
growth for the rest of this year and in 2019, WTO economists expect .  
 
Trade will continue to expand but at a more moderate pace than previously forecast . The WTO 
anticipates growth in merchandise trade volume of 
3.9% in 2018,  with trade expansion slowing further 
to 3.7% in 2019 . The new forecast for 2018 is 
below the WTO's 12 April estimate of 4.4%  but falls 
within  the 3.1% to 5.5% growth  range indicated at 
that time. Trade growth in 2018 is now most likely 
to fall within a range from 3.4% to 4.4% (Table 1).  
 
Some of the downside risks identified in the April 
press release have since materialized, most notably 
a rise in  actual and proposed trade measures 
targeting a variety of exports from large 
economies . The direct economic effects of these 
measur es have been modest to date but the 
uncertainty they generate may already be having 
an impact through reduced investment spending. 
Monetary policy tightening in developed economies 
has also contributed to volatility in exchange rates 
and may continue to do  so in the coming months.  
 
WTO Director General Roberto Azevêdo said: 
“While trade growth remains strong, this 
downgrade reflects the heightened tensions that 
we are seeing between major trading partners. 
More than ever, it is critical for governments to 
work through their differences and show restraint. 
The WTO will continue to support those efforts  and 
MAIN POINTS  
•World merchandise trade volume is 
forecast to grow 3.9% in 2018,  
accom panied by global GDP growth of 
3.1% at market exchange rates.  
•Trade volume growth should slow to 
3.7% in 2019 as global GDP growth dips 
to 2.9 %. 
•Rising trade tensions pose the biggest 
risk to the forecast,  but monetary 
policy tightening and  associated  
financial volatility could also destabilize 
trade and output.  
•Trade -related indicators show a loss of 
momentum,  including global export 
orders and economic policy uncertainty . 
•North America had the fastest export 
growth and Asia had the strongest 
import growth  in the first half of 2018  
while resource -based economies still 
struggled.  PRESS/ 822 
 
- 2 - 
 
  ensur e that trade remains a driver of  better  living standards , growth and job creation around the 
globe .”  
 
The updated trade forecast is based on expectations of  world real GDP growth at market exchange 
rates of 3.1% in 2018 and 2.9% in 2019 . This implies a ratio of trade growth to GDP growth of 1.3 
in both years .  
 
Trade policy measures are far from the only risk to the forecast. Developing and eme rging 
economies could experience capital outflows and financial contagion as developed countries raise 
interest rates, with negative consequences for trade . Geopolitical tensions could threaten resource 
supplies and upset production networks in certain reg ions. Finally, structural factors such as the 
rebalancing of the Chinese economy away from investment and toward consumption are still 
present and could weigh on import demand due to the high import content of investment. Overall, 
risks to the forecast are  considerable and heavily weighted to the downside.  
 
Chart 1: World merchandise exports and imports by level of development, 2012Q1 -
2018Q2  
Volume index, 2012Q1=100  
 
Source : WTO and UNCTAD.  
Charts 1 and 2 show seasonally -adjusted export and import volumes broken down by level of 
development and geographic region. In the first half of 2018, world merchandise trade was up 
3.8% compared to the same period in the previous year . Exports of developed economies rose 
3.5% during the same period while shipments from  developing economies increased by 3. 6%. On 
the import side, developed economies recorded year -on-year growth of 3.5 % in the first half of 
2018 while developing countries registered an increase of 4.9% . Imports  of developed economies 
have generally been fl at in 2018 while exports  of developing economi es plateaued similarly.  
 
All geographical regions recorded positive year -on-year trade growth in both exports and imports 
in the first half of 2018, but some regions performed better than others . North America saw the 
fastest export growth during this period at 4.8%, followed by Asia at 4. 2% and Europe at 2. 8%. 
Exports of Other regions (comprising Africa, the Middle East and the Commonwealth of 
Independent States including associate and former member States) inc reased by 2.7% while those 
of South America were up 1.1%. Asia had the fastest import growth ( 6.1%) followed by South 
America (5. 5%), North America (4.8%), Europe (2.9%) and Other regions ( 0.5%). 
9095100105110115120125130
2012Q1
2012Q3
2013Q1
2013Q3
2014Q1
2014Q3
2015Q1
2015Q3
2016Q1
2016Q3
2017Q1
2017Q3
2018Q1Exports
World Developed Developing9095100105110115120125130
2012Q1
2012Q3
2013Q1
2013Q3
2014Q1
2014Q3
2015Q1
2015Q3
2016Q1
2016Q3
2017Q1
2017Q3
2018Q1Imports
World Developed DevelopingPRESS/ 822 
 
- 3 - 
 
  Prices of energy commodities including oil have risen 33% fo r the year -to-date through August 
compared to last year, boosting export revenues of commodity exporters. This has not yet 
translated into strong import demand in resource -rich regions, as one might expect. Meanwhile the 
US dollar has appreciated by 8.4% i n real effective terms since January of 2018.  
 
Chart 2: Merchandise exports and imports by region, 2012Q1 -2018Q2  
Volume index, 2012Q1=100  
 
a Refers to South and Central America and the Caribbean.  
b Other regions comprise Africa, Middle East and the Commonwealth of Independent States, including 
associate and former member States.  
Source:  WTO and UNCTAD.  
The downward revision to the trade forecast  is consistent with  the WTO's World Trade Outlook 
Indicator (WTOI), which has signall ed slowing trade momen tum since the first quarter of 2018 . 
The WTOI combines several leading indicators for trade into a single composite indicator. 
Components include container port throughput, air freight shipments, exp ort orders, automobile 
sales and  trade in electronic comp onents and raw materials.  The export orders component, derived 
from purchasing mangers' indices, has fallen from 54.1 in January to 50.3 in August , just above 
the baseline value of 50.0 separa ting expansion from contraction (Chart 3) .  
 
8090100110120130140
2012Q1
2012Q3
2013Q1
2013Q3
2014Q1
2014Q3
2015Q1
2015Q3
2016Q1
2016Q3
2017Q1
2017Q3
2018Q1Exports
North America South America  a Europe
Asia Other regions  b8090100110120130140
2012Q1
2012Q3
2013Q1
2013Q3
2014Q1
2014Q3
2015Q1
2015Q3
2016Q1
2016Q3
2017Q1
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2018Q1Imports
North America South America  a Europe
Asia Other regions  bPRESS/ 822 
 
- 4 - 
 
  Chart 3:  Global PMI  new export orders index, Jan. 2010 - August 2018  
Index, base = 50.  
 
Note:  Values greater than 50 indicate expansion while values less than 50 denote contraction.  
Source:  IHS Markit . 
A separate indicator of  economic policy uncertainty is based on the frequency of keywords related 
to uncertainty in press reports  (Chart 4) . The index value rose from 113 to 227 between January 
and July before falling back to 205 in August . Although uncertainty has eased slightly recently, it 
remains higher than during the  global financial crisis of 2008. To the extent that economic 
uncertainty deters investment it can have a negative impact on trade since capital goods tend to 
have high import content.  
 
Chart 4:  Global economic policy uncertainty, Jan. 2005 - Aug. 2018  
(index, average 1997 -2015=100)  
 
Source:  PolicyUncertainty.com . 
The trade f igures above refer to merchandise trade in volume terms, but trade in current US  dollar 
terms is also relevant. This is illustrated by Chart 5,  which shows growth of merchandise export s 
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204.5
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2005M01
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2006M01
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- 5 - 
 
  and imports of selected economies in current US dollar terms . US exports and imports remain 
strong despite the recent appreciation of the US dollar. Note that n ominal trade statistics should 
be interpreted with caution as they may be  strongly influenced by prices and exchange rates.  
 
Table 1: Merchandise trade volume and real GDP, 2014 -2019  a  
Annual % change  
 
a Figures for 2018 and 2019 are projections.  
b Average of exports and imports.  
c Includes the Commonwealth of Independent States (CIS), including associate and former member 
States.  
d Other regions comprise Africa, Middle East and Commonwealth of Independent States (CIS).  
Sources:  WTO and UNCTAD for trade, consensus estimates for GDP.  
 
2014 2015 2016 2017 2018P 2019P
Volume of world merchandise trade  b 2.7 2.4 1.8 4.7 3.9 3.7
Exports
Developed economies 2.1 2.2 1.1 3.4 3.5 3.3
Developing economies  c 2.7 1.9 2.5 5.3 4.6 4.5
North America 4.6 0.8 0.6 4.2 5.0 3.6
South and Central America -2.1 1.8 2.0 3.3 2.8 2.6
Europe 1.5 2.9 1.2 3.5 2.9 3.2
Asia 4.5 1.4 2.3 6.7 5.5 4.9
Other regions  d -1.3 3.5 3.4 0.2 2.6 3.6
Imports
Developed economies 3.3 4.3 2.1 3.0 3.2 3.0
Developing economies  c 2.6 0.7 1.6 8.1 4.8 4.5
North America 4.3 5.4 0.0 4.0 4.3 3.6
South and Central America -2.5 -6.3 -6.7 4.0 3.6 4.0
Europe 3.0 3.6 3.3 2.5 3.1 3.0
Asia 3.7 3.8 3.5 9.8 5.7 4.9
Other regions  d 0.7 -4.5 -1.7 3.5 0.5 1.4
Real GDP at market exchange rates 2.8 2.8 2.3 3.0 3.1 2.9
Developed economies 2.0 2.3 1.6 2.3 2.4 2.0
Developing economies  c 4.3 3.7 3.7 4.3 4.4 4.5
North America 2.6 2.7 1.6 2.3 2.7 2.2
South and Central America 0.8 -0.8 -1.9 0.8 1.3 2.5
Europe 2.0 2.4 2.0 2.7 2.3 2.1
Asia 4.1 4.3 4.1 4.5 4.5 4.3
Other regions  d 2.5 1.1 2.1 1.9 2.7 3.0PRESS/ 822 
 
- 6 - 
 
  Chart 5 : Merchandise exports and imports of selected economies, January 2016 -July 
2018  
(Year -on-year percentage change in current dollar values)  
 
a January and February averaged to minimize distortions due to lunar new year.  
Sources:  IMF International Financial Statistics, Global Trade Information Services GTA databas e, national 
statistics.  
 
END 
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