The latest DHL Global Trade Barometer (GTB) has found that world trade momentum is weaker but growing and will continue to expand over the next three months.
The GTB said with an overall index of 75 points, India continues to be the country with the strongest trade growth forecast, and indices for all seven countries in the index indicate further growth. However, the pace slows down in all index countries – particularly in Asia, and the weakest trade growth is in the UK.
With an overall index of 61 points, the GTB’s analysis of international air and containerized ocean trade flows indicates the development of the previous quarters will continue.
Indices for all seven countries that constitute the GTB index (India, South Korea, USA, China, Japan, Germany and the UK) are above 50 points, which corresponds to a positive growth forecast according to the underlying methodology. The pace of growth, however, is further slowing in all index countries.
The GTB said deceleration will be particularly strong in Asia (except for China): Index values for India, Japan and South Korea have dropped by eight, six and five points respectively compared to the previous release of the GTB in September.
DHL Global Forwarding, Freight, chief executive officer, Tim Scharwath said: “The DHL Global Trade Barometer clearly shows that the state of global trade remains solid. Both, air and ocean trade, continue to grow around the world.
“However, given the smoldering trade conflicts, especially between the US and China, and economists’ expectations that the global economy could cool down, it is not entirely surprising that trade momentum has weakened slightly.”
The GTB said trade growth in the US (61 points) and China (58 points) remains solid. Both countries’ momentum of growth is slowing only moderately by two and one points, respectively – even though both countries would have much to lose if their trade conflict escalated.
With a two-point decline and an index value of 56 points, Germany’s loss of trade growth momentum turns out to be moderate, too, compared to September. While the UK was able to keep its GTB index unchanged in the previous release, its growth forecast has now deteriorated noticeably by four points.
This makes it the index country with the weakest growth forecast: With 53 points, the UK is only slightly above the 50-point mark, which indicates stagnation in trade growth.
The worldwide deceleration of trade growth is attributable to declines in both containerized ocean freight and international air trade – with last year being a peak year with exceptionally high volumes. South Korea is the only country whose growth forecast for ocean trade remains unchanged.
In all the other countries, the outlook for ocean trade is declining. Furthermore, the air trade outlook is going down in every index country. With an eye to individual sector developments, industrial raw materials contributed most to international trade growth, followed by machine parts and basic raw materials. The weakest growing categories were consumer & household goods, capital equipment and machinery parts.
Launched in January 2018, the DHL GTB looks at the current state and future development of global trade. It is based on large amounts of logistics data that are evaluated with the help of artificial intelligence and has been developed with IT service provider Accenture. It is published four times a year. The next release date is scheduled for 27 March, 2019.