The latest update from UNCTAD, the United Nations Conference on Trade and Development, suggests that while global trade has slowed, it is seeing continued growth in trade of 'environmental goods' - refering to products that are designed to use fewer resources or emit less pollution than their traditional counterparts.
Global trade in goods was estimated at US$25trn in 2022, declining by 3% in the fourth quarter. But trade in services remained almost constant, finishing the year at US$7trn.
The trend toward weaker trade has been especially felt in developing nations, since the end of 2022. UNCTAD now forecasts Q1 2023 growth of about 1% in global trade by value. Services could grow by some 3% over the quarter, on the basis of demand for information and communication technology services, travel and tourism.
Growth in environmental goods is predicted to continue outpacing broader trade trends. The organisation in its recent Technology and Innovation Report 2023, projected the global market for electric cars, solar and wind energy, green hydrogen and a dozen other green technologies could reach US$2.1trn by 2030 - four times more than their current value.
The second half of 2023 could see a recovery in trade growth trends, UNCTAD continued.
It highlighted factors such as the prospects of an averted recession in the European Union and the United States, and a weaker US dollar, which fell by almost 7% between November 2022 and February 2023. With most trade denominated in dollars, weakness ould result in increased demand for traded goods, it said.
And it spots an easing of concerns around global supply chain disruptions and shipping costs. The Shanghai containerised freight rate index has returned to pre-pandemic levels and is expected to remain low throughout 2023. And the China purchasing managers index has increased by more than 5 percentage points since December 2022, indicating strong manufacturing and services activity.
