The US and eurozone are set to lead export growth in the short term
Growth in exports will rise to 8 per cent per year by 2017, according to HSBC’s latest Trade Forecast. The US and eurozone are likely to lead growth in the short term until a recovery in emerging markets takes hold, driving later expansion.
The HSBC Trade Forecast is modelled by Oxford Economics for HSBC. It says that annual growth in the value of goods exported globally will accelerate to 8 per cent by 2017, up from an average of 1.5 per cent between 2012 and 2014.
Simon Cooper, Chief Executive of Global Commercial Banking, HSBC, said: “In the short term an increasingly robust US economy, aided by cyclical upturns in Europe and Japan, is likely to provide the greatest cross-border opportunities for businesses. Further out, demographic trends in emerging markets will undoubtedly fuel greater ‘South-South’ trade.”
Trade between emerging markets will become more significant as their middle classes expand
The HSBC Trade Forecast examines prospects for exporters in 25 countries and territories. It shows that the short-term outlook for emerging economies is patchy, in part because of relatively low commodity prices and a moderation in Chinese growth.
Over the medium term, however, patterns of global trade will be increasingly influenced by rapidly-growing Asian economies with rising average incomes. Trade between emerging markets will become more significant as their middle classes expand.
Among the countries covered in the Trade Forecast, Vietnam, India, China, Turkey and Bangladesh are expected to experience the strongest trade growth. Each is predicted to increase merchandise exports by an average of 8 per cent or more per year between 2015 and 2030.
Trade could be further boosted over the longer term by new measures to liberalise trade, with a number of international agreements under discussion in 2015.
These include the World Trade Organization (WTO) Trade Facilitation Agreement, which would reduce red tape and streamline customs requirements around the world. A proposed extension to the WTO’s Information Technology Agreement would exempt many new electronic products from international duties and tariffs.
Another proposed agreement, the Transatlantic Trade and Investment Partnership, would eliminate tariffs and harmonise regulatory standards between the US and the EU. A separate initiative, the Trans-Pacific Partnership, aims to create a free-trade zone across 12 countries in the Asia-Pacific region.
Mr Cooper said: “If ratified, the international trade deals currently under negotiation could have a major catalytic effect – one that’s hard to quantify, but that should give businesses plenty of reasons for optimism.”
The HSBC Trade Forecast is modelled by Oxford Economics for HSBC. Oxford Economics produces a global report and country-specific reports on the following 23 countries and territories: Hong Kong, China, Australia, Indonesia, Malaysia, India, Singapore, Vietnam, Bangladesh, Canada, USA, Brazil, Mexico, Argentina, UK, France, Turkey, Germany, Poland, Ireland, UAE, Saudi Arabia, and Egypt. The global report also includes analysis of trade with Japan and Korea. For more information and to read the full HSBC Trade Forecast, visit the HSBC Global Connections website.