CSCMP's Supply Chain Quarterly
December 16, 2017
Supply Chain Executive Insight E-Newsletter
Each week the Supply Chain Executive Insight e-newsletter will include brief articles about developments that are often overlooked by other supply chain publications. We will present you with summaries of the latest research as well as new ideas on how to make your supply chain operations more effective. And we'll offer commentary that sheds light on what's happening in supply chains today.
Sign up now!

Most Read Articles

News from our sister publication
DC Velocity
Forward Thinking

Global trade declined marginally as countries contend with economic uncertainty

Comment
Due to a decline in both imports and exports of goods and services, global trade levels marginally contracted by 0.26 percent in Q4/2011.

Due to a decline in both imports and exports of goods and services, global trade levels marginally contracted by 0.26 percent in Q4/2011. The Global Trade Flow Index indicates positive momentum in India and Brazil, primarily due to increasing exports, while China retains its leading position, followed closely by the United States.

In Q4, U.S. trade volume declined by 0.95 percent. Key influences were the euro crisis, weakening business investment, rising commodity prices, and falling real incomes. The European Union continues to be affected by the debt crisis, tallying a decline in total trade of 0.74 percent in Q4/2011. This is mostly due to an appreciated euro and less demand for EU goods and services. Japan saw only a small decrease in trade volumes, primarily caused by a slowdown in industrial activity and reduced demand from the United States and Europe.

Article Figures
[Figure 1] CapGemini Consulting global trade flow index
[Figure 1] CapGemini Consulting global trade flow index Enlarge this image
[Figure 2] Container throughput vs. growth in trade
[Figure 2] Container throughput vs. growth in trade Enlarge this image

Emerging markets continue to post moderate growth in trade volumes, led by Brazil and India with increases of 2.9 and 4.0 percent, respectively. Brazil's commodities exports are being fueled by rising business investments, and India remains consistent with its exports of gems, jewelry, services, and engineered goods combined with a depreciating currency. China's growth has slowed due to tight monetary policy, weakening export demand from the EU, a slowdown in domestic demand for commodity imports, and an appreciating currency.

Moving into Q1/2012, global trade flows are expected to grow, but moderate risk does exist due to the presence of the European sovereign debt crisis, inflationary pressures, and uncertainty around rising oil prices. Higher oil prices will result in a reduction of purchasing power for consumers, impacting growth and trade volumes. In addition, the growing Chinese property bubble will have a significant impact on the world economy, as it will destabilize China's financial system and affect investment there for the long term.

For more about Capgemini Consulting's trade information services, contact Dan Albright, Vice President or Bryan Garcia, Managing Consultant.

Join the Discussion

After you comment, click Post. If you're not already logged in, you will be asked to log in or register.


Want more articles like this? Sign up for a free subscription to Supply Chain Executive Insight, a monthly e-newsletter that provides insights and commentary on supply chain trends and developments. Click here to subscribe.

We Want to Hear From You! We invite you to share your thoughts and opinions about this article by sending an e-mail to ?Subject=Letter to the Editor: Quarter 2012: Global trade declined marginally as countries contend with economic uncertainty"> . We will publish selected readers' comments in future issues of CSCMP's Supply Chain Quarterly. Correspondence may be edited for clarity or for length.

Want more articles like this? Subscribe to CSCMP's Supply Chain Quarterly.