Global trade saw a gradual pickup in the first quarter of 2024 fuelled by easing price pressures in major economies like the US. Experts believe trade growth will likely continue if inflation remains well-controlled and economic projections remain positive. India and China led the way with their exports posting extremely strong quarterly gains as goods trade among key nations reversed course after declining for most of 2023.
UNCTAD, a leading UN trade body, noted global trade expanded modestly in Q1 aided by US trade benefiting from softer inflation and rosier growth forecasts. They expect demand for energy transition and artificial intelligence products to further support trade growth this year. However, geopolitical tensions, rising shipping costs and protectionist policies pose downside risks to the 2024 outlook according to their analysis.
The report found prices of imported goods held steady in the first 3 months but may rise again in Q2 with values increasing faster than volumes. Trade declines seen among major countries last year were offset in the period for some with US imports and exports from Russia, China and India surging. Only Japan and South Africa saw trade continue falling.
While subsidies provided by developed and emerging economies are seen boosting competitiveness in key sectors globally, UNCTAD warns this could distort trade flows and squeeze out smaller players over time. They advocate cooperation to ensure a level-playing field instead of unilateral subsidies and protectionist steps risking escalation and undermining established trade rules.