Chennai: India, China and the US drove the global trade growth, which turned positive in the first quarter of 2024 with the value of trade in goods increasing by around 1 per cent quarter-over-quarter and services by about 1.5 per cent, finds the UN's trade body.
Global trade trends turned positive in the first quarter of 2024, with the value of trade in goods increasing by around 1 per cent quarter-over-quarter and services by about 1.5 per cent.
According to UNCTAD, the trade growth was primarily driven by increased exports from China 9 per cent, India 7 per cent and the US 3 per cent. Europe’s exports showed no growth and Africa’s exports decreased by 5 per cent.
In the first quarter of 2024, global trade continued its modest and gradual increase that began in the second half of 2023. Both merchandise and services showed positive quarter-over-quarter global trade growth in Q1 2024, with expectations of further increases in Q2 2024. This points towards a return to growth in global trade of goods in 2024, while also indicating the conclusion of the robust upward trend in trade in services. Overall, moderating global inflation and improving economic growth forecasts suggest a reversal of the downward macroeconomic trends that have characterized most of 2023.
Merchandise exports from India were up 7 per cent and imports into India were down 1 per cent. Similarly, services exports from India were up 3 per cent and imports were down 2 per cent.
UNCTAD also found that geo-economic issues continued to play a significant role in shaping key bilateral trade trends. Among dynamic bilateral trade between countries, India’s dependence on China increased 1.2 per cent and was up 1 per cent on Europe. Its dependence on Saudi Arabia was down 0.5 per cent.
UNCTAD also predicted a stronger positive trend for Q2 2024, projecting an approximate 2 per cent increase for the first half of 2024. This increase is expected to add around $250 billion to goods trade and about $100 billion to services trade in the first half of 2024 compared to the second half of 2023. If positive trends persist, global trade in 2024 could reach almost $32 trillion, yet it is unlikely to surpass its record level seen in 2022.
Despite these positive trends, the outlook for 2024 is tempered by potential geopolitical issues and industrial policy impacts. Geopolitical tensions, rising shipping costs, and emerging industrial policies could reshape global trade patterns. The report warns that an increasing focus on domestic industries and trade restrictions could hinder international trade growth.
