Amsterdam (ots/PRNewswire) - Anti-trade rhetoric and political
developments in mature markets likely to stall trade growth
After a very low pace of growth in 2015, global trade growth has
slowed even further over the first half of 2016, according to
Atradius Credit Insurance N.V.
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Trade growth in Emerging Asia, the world's second largest trade bloc,
is extremely low, as China rebalances from investment-driven growth
toward a more inward-looking consumption-led growth. Lower commodity
prices have also dampened investment in natural resource-rich
economies around the world which has contributed to a sharp
contraction of trade in Eastern Europe and slowdown in Latin America.
Even the US has seen its trade growth grind to a halt, due to lower
investment in the oil and gas sector, but also because of lower
external demand and a strong USD which have reduced exports.
In 2016, the tempo of growth in world trade is expected to be about
one-third of global GDP growth. Such a low rate of trade growth has
not occurred since the global economic crisis of 2009.
Anti-globalisation sentiment is rising, as is evidenced by political
developments like Brexit and the election of Donald Trump as US
president. Trade liberalisation efforts like TPP and TTIP are
stalling, thereby threatening the outlook for trade.
Subdued global GDP growth already motivates a subdued global
insolvency outlook, but muted trade growth could put upward pressure
on insolvencies in countries that are dependent on trade.
Brexit-related uncertainty is expected to increase corporate
bankruptcies in economies with a heavy focus on exporting to the UK.
Protectionist measures in the US could have the same effect on
economies with high trade ties to the US, especially those in Latin
America.
"Matters for trade are made far worse by political developments,"
said John Lorié, global chief economist at Atradius, "These are
flatly trade-unfriendly, as signalled not only by the Brexit vote in
the UK, but also by the stalling of the regional trade liberalization
efforts. Anti-trade rhetoric by US president-elect Donald Trump make
matters even worse. These developments are likely to weigh on future
trade data."
Read more about the global economic environment and gain insights
into prospects and risks based on the main regions in our November
Atradius Economic Outlook.
About Atradius
Atradius provides trade credit insurance, surety and collections
services worldwide through a strategic presence in 50 countries.
Atradius has access to credit information on 200 million companies
worldwide. Its credit insurance, bonding and collections products
help protect companies throughout the world from payment risks
associated with selling products and services on trade credit.
Atradius forms part of Grupo Catalana Occidente (GCO.MC), one of the
leading insurers in Spain and worldwide in credit insurance.
atradius.com
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