WTO publishes downcast outlook indicator

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The latest figures on trade growth from the WTO do not look positive.

The World Trade Organisation (WTO) has published a new report suggesting that global goods trade growth is likely to remain weak.

Its quarterly outlook indicator this week showed a reading of 96.3, which was unchanged from February and represents the lowest figure since 2010.

Anything below 100 in the indicator signals below-trend growth in global goods trade.

The WTO said this latest result came due to declines in all but two component indices, including international air freight and automobile production. Container port throughout also declined, although this figure remained above 100 and therefore recorded growth.

Indices for export orders and electronic components were shown in the report to have bottomed out.

"The outlook for trade could worsen further if heightened trade tensions are not resolved or if macroeconomic policy fails to adjust to changing circumstances," the WTO warned, pointing out that these new figures also do not take into account recent developments in the trade war between the US and China.

For its quarterly indicator, the WTO takes into account merchandise trade volume in the previous quarter, export orders, the transport of goods by air and sea, car production, electronic components sales and the movement of agricultural raw materials.

The news comes after the WTO said last month that world trade could continue to face strong challenges in 2019 and 2020 after lower-than-expected growth during 2018 due to trade tensions and economic uncertainty.

It predicted that merchandise trade volume growth will fall to 2.6 per cent this year before rebounding to three per cent in 2020, although this is dependent on the easing of current trade wars.

WTO director-general Roberto Azevedo said: "It is increasingly urgent that we resolve tensions and focus on charting a positive path forward for global trade which responds to the real challenges in today's economy - such as the technological revolution and the imperative of creating jobs and boosting development."