GLOBAL TRADE UPDATE OF UNCTAD (Syllabus: GS Paper 3 – Economy)

News-CRUX-10     3rd July 2024        

Context: Global trade rebounded in the first quarter of 2024 after a contraction in 2023, with the UN Trade and Development (UNCTAD) reporting a sequential increase of about 1% in goods and 1.5% in services.

United Nations Conference on Trade and Development (UNCTAD) 

  • About: UNCTAD is a permanent intergovernmental body established by the United Nations General Assembly.
  • Objective: Its objective is to assist developing countries, especially the least developed countries, and countries with economies in transition, to integrate beneficially into the global economy.
  • Focus: on four main areas: trade and development, investment and enterprise, technology and innovation, and macroeconomics and development policies.
  • Founded in: 1964. 
  • Headquarter: Located in Geneva, Switzerland. 

    Key Highlights of Global Trade Update

    • Positive Trade Surge Expected: The UNCTAD forecasts a substantial increase in global goods and services trade for the first half of 2024, driven by favorable trade dynamics, particularly in large Asian developing economies.
    • Global Economic Outlook: Despite a stable global GDP growth projection of around 3% for 2024, the short-term outlook for international trade remains cautiously optimistic, with potential trade volume nearing $32 trillion.
    • Geopolitical Concerns Impacting Trade: Geopolitical events such as Houthi attacks in the Red Sea, the Russia-Ukraine conflict, US-China trade tensions, and EU regulatory measures have significantly influenced global trade performance in 2024.
    • Sectoral Performance

    oGoods and Services Trade: Services sector resilient with an 8% increase; goods trade saw a 5% decline compared to 2022.

    oSector-Specific Growth: Green energy and AI-related products showed robust growth trends.

    • Export-Import Dynamics: Varied performance among major economies; notable improvements in exports for China, India, and the US; contrasting declines for Japan and South Africa.
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