New regional growth trends drive global trade above pre-pandemic levels, DHL study finds
Global trade is bigger than ever despite the Covid-19 pandemic, the war in Ukraine, supply chain disruptions and the worldwide economic slowdown, driven by rapid growth in emerging markets and continued growth in advanced economies, according to a comprehensive new DHL study presented today.
International trade in goods has surged to as high as 10% above levels before the Covid-19 pandemic and is projected to grow faster in 2022 and 2023 than it did over the previous decade, according to the new DHL Trade Growth Atlas, which was presented to international media, including CEP-Research, in Brussels.
Notably, new trade growth leaders are emerging in Southeast and South Asia, including Vietnam, India and the Philippines, while Sub-Saharan Africa's exports are poised to accelerate dramatically, the in-depth report found.
Shifting growth trends
Among the key findings of the DHL Trade Growth Atlas are:
- The Covid-19 pandemic has not been the major setback for global trade that many anticipated: International trade in goods has surged as high as 10% above pre-pandemic levels, even in the face of significant supply bottlenecks that constrained further growth.
- Prospects for future trade growth remain surprisingly positive: Due to the war in Ukraine, trade growth forecasts have been downgraded, but they still call for trade to grow slightly faster in 2022 and 2023 than it did over the preceding decade.
- E-commerce sales boomed during the pandemic and forecasts point to strong cross-border e-commerce growth continuing.
- New poles of trade growth are identified in Southeast and South Asia, and trade growth is expected to accelerate dramatically in Sub-Saharan Africa.
- Trade growth is spread across a wider variety of countries: China accounted for a quarter of trade growth in recent years and is predicted to continue to have the largest growth, but its share is likely to fall by half, to 13 percent.
- Viet Nam, India, and the Philippines stand out on both speed and scale of projected trade growth through 2026. All three have potential to benefit from efforts by many companies to diversify China-centric production and sourcing strategies.
- While emerging economies increased their shares of world trade from 24 to 40 percent between 2000 and 2012, with half of the increase driven by China alone, these shares have barely changed over the past decade.
- However, emerging economies continue to race forward on measures of connectivity, innovation, and leading companies. They are becoming more important exporters of sophisticated manufactured products, and increasingly compete not only on low costs, but also on innovation and quality.
Report author Steven Altman, Senior Research Scholar and Director of the DHL Initiative on Globalization at NYU Stern’s Center for the Future of Management, said: “The results show how there are still large trade growth opportunities in both advanced and emerging economies and in regions around the world. The trade landscape is shifting and presenting new challenges, but this report strongly rebuts predictions of a major retreat from global trade.”
John Pearson, CEO of DHL Express, explained: “Our aim is for the DHL Trade Growth Atlas to become a go-to resource for understanding and navigating shifts in the global trade landscape. Trade will remain a key driver of prosperity – as it has been for centuries.
“In the current global business environment, DHL can help customers rethink certain supply chains, basing them on a sensible trade-off between cost and risk so that they are both efficient and secure. As the world's leading logistics provider, we offer solutions for all logistics requirements, and have proven to provide stable and reliable services even in volatile market environments,” he added.
Big data analysis
Covering 173 countries that comprise more than 99% of world trade, GDP, and population, the DHL Trade Growth Atlas examines global trade growth trends, geographic shifts, the mix of products traded, and broader changes in the business environment. It analyzes trade in goods worldwide, by region, for advanced vs. emerging economies and complements the DHL Global Connectedness Index series.
- CEP-Research will report in more detail on the report's findings and the outlook for world trade tomorrow.