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Each day TFO Canada publishes a sample of trade news on the Canadian import market along with any new, updated or changed regulations and legislations regarding international trade; countries in which TFO Canada offers services and on the export sectors which it promotes.

 

WTO: Developing countries participate in nearly half of world trade

Wednesday, October 22, 2014 > 12:44:51
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(La Prensa)

For the first time ever, the participation of developing countries in world trade accounts for nearly half of global trade, according to a report released on Monday by the World Trade Organization, or WTO.

The report points out that during the period between 2000 and 2012 the involvement of developing countries in world trade increased from 33 to 48 percent.

In the same period, the share of developing economies in world production rose from 23 to 40 percent.

The report shows the changing role of developing economies in world trade.

"Developing countries now account for half of the intermediate goods trade - which is a standard measure of global value chains. And south-south trade accounts for a quarter," said WTO Director-General Roberto Azevedo in opening remarks at the presentation of the document in Geneva.

The report points out that since 2000, the GDP per capita in developing nations increased by 4.7 percent and only by 0.9 percent in developed countries.

It stresses the growing importance of developing countries in world trade; the rise of global value chains; the new role of raw materials in development strategies and the synchronization and globalization of macroeconomic shocks.

The document also indicates that G20 countries have shown double-digit growth in recent years.

Demand for raw materials, in many cases coming from developing countries, have increased the prices of commodities, and therefore have helped the development of nations that possess them.

Between 2000 and 2011, developing countries also increased their share of world agricultural exports from 27 percent to 36 percent.

The report mentions the increasing fragmentation of global production and points out that more than half of total exports from developing countries, in terms of added value, are related to global production chains.

Moreover, synchronized global trade led to the globalization of the 2008-2009 crisis, but also showed the benefits of a system that includes almost all countries.

The rules and regulations of the WTO helped mitigate those impacts, noted Azevedo.

A clear example of this is that after the 2008 crisis there was no wave of trade protectionism, as during the Great Depression, he added.

On September 23, the WTO revised downwards its forecast for world trade growth to 3.1 percent in 2014, compared to 4.7 percent projected in April.

The WTO also adjusted its trade forecast for 2015, in which it considered that growth will reach a maximum of 4 percent instead of the 5.3 percent previously estimated.

These rates are well below the average growth over the last 20 years, of 5.2 percent.

Azevedo said 2015 will be the third consecutive year with below average growth, and the situation is not expected to improve in the short term.


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