Global goods trade continues recovery in Q3 2024: WTO

Global goods trade continued its recovery in Q3 2024, building on gains earlier in the year after a sluggish 2023, the World Trade Organization (WTO) stated in its latest Goods Trade Barometer report.

However, WTO warned that rising geopolitical tensions and other factors pose risks to the trade outlook.

According to the report, the volume of world merchandise trade began to pick up in the final quarter of 2023 after stagnating since late 2022, growing 1 per cent quarter-on-quarter in Q1 2024 and 1.4 per cent year-on-year.

This growth followed a period of weak demand, driven by high inflation and interest rates across key markets.

Read: Global trade sees growth in Q1 2024, shares UNCTAD

Quarter-on-quarter growth averaged 0.7 per cent over the last two quarters, which translates to an annualised rate of 2.7 per cent. This closely aligns with the WTO’s April 2024 forecast of a 2.6 per cent increase in global trade volume for the year.

However, regional trade patterns have diverged, with weaker-than-expected growth in Europe offset by stronger performance in other regions. The WTO indicated that it may revise its regional forecasts in its next update due in October.

The WTO Goods Trade Barometer, which tracks trade trends, showed that most component indices are on or above trend.

The barometer’s overall reading suggests steady growth, with the automotive products index at 103.3, container shipping at 104.3, and air freight at 107.1.

However, the electronic components index fell below the trend to 95.4, while new export orders (101.2), usually a key predictor, have started to decline.

Global trade outlook

Despite positive signals, the WTO stressed that the global trade outlook remains clouded by geopolitical instability, regional conflicts, shifting monetary policies in advanced economies, and weakening export orders.

The next WTO trade forecast is expected in mid-October, offering further insights into how these challenges could shape global trade in the coming months.

In a report published earlier in May, the OECD expects global trade in goods and services to grow by 2.3 per cent this year and 3.3 per cent in 2025 – more than double the 1 per cent growth seen in 2023.