International trade in goods is forecast to grow by 7% this year, although a stronger investment climate is likely to be mixed with fragile prospects for consumption and employment particularly in Europe, the WTO said on April 11. While the prediction represents an improvement on the 6% growth in global commerce recorded in 2005, it will still be less than the "exceptional" 9% that was logged in 2004, said the World Trade Organization in its initial review.
"In the developed countries, the broadly improved financial situation of the corporate sector and the rise in stock markets are indicators suggesting that the long awaited recovery of investment in Europe will eventually materialize and trigger broader economic growth," said the WTO. "However, the recovery of private consumption remains fragile if the employment situation does not improve and energy costs continue to rise."
Rising oil prices drove strong export growth in 2005 in Africa, the Middle East, Central and South America and the former Soviet Union, all of which are net exporters of fuels.
Their imports also grew by a combined 12%.
Europe's trade performance was sluggish in 2005, in line with its overall economic performance. Its export and import growth were weaker than in all other regions.
In the U.S., lower economic growth contributed to a deceleration in its merchandise imports, which for the first time since 1997 rose less than merchandise exports.
While China's economy continued to grow strongly in 2005, by almost 10% overall, the country's import growth was nearly halved to 11.5%. Imports fell in China for textiles and non-ferrous metals, and stagnated for fuels and motor vehicles. But imports of computers, telecom equipment and electrical goods rose. Chinese merchandise exports continued to expand by 25%, a similar rate to 2004.
Within the manufacturing sector, the largest export increases in 2005 were for iron and steel products and for chemicals. Demand also recovered somewhat for computers and other electronic products.
Copyright Agence France-Presse, 2006