Global trade rebounds to pre-crisis level

City A.M. Reporter
International trade volumes exceeded pre-crisis levels for the first time in December, the Dutch CPB economic institute has said.

It found that global trade expanded by a record 15.1 per cent in the whole of 2010, evidence of a buoyant global economy and more than compensating for the 13 per cent contraction in 2009 in the wake of the financial crisis.

The 2010 and 2009 figures were respectively the biggest expansion and contraction since the institute started compiling the data in 1991, CPB economist Jos Ebregt told Reuters.

But the gains were shared unevenly, with trade expanding the most in the emerging economies of Asia and Latin America, it said in its monthly world trade monitor.

Import and export growth in the US were close to the world average but growth in the euro area lagged behind considerably.

CPB, whose data are used by the World Bank and European Commission, said its index of merchandise trade volumes – set at 100 in the year 2000 – had reached 164.5 in December, up from 161.5 in November and compared with a previous high of 163.8 in April 2008. The index fell to 130.3 in May 2009.

World exports had recovered to pre-crisis levels in November, but global imports did not match previous peaks until December, the data show.

The sum of global imports and exports should be the same, but statistical differences in different countries often lead to a disparity.

The 2010 expansion in trade was boosted by strong growth in the fourth quarter, when trade volumes rose 2.6 per cent over their level in the third quarter. In the third quarter they rose only 0.7 per cent over their level in the previous three months.

The figures suggest that world trade – and hence the global economy – is picking up again. The pace of recovery in world trade had slowed for much of 2010 with the completion of the initial wave of inventory-building.