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Global trade continued to lose momentum in 2016.
Growth in global trade remained rather low in parallel both
with the rather limited recovery that global economic activity
has managed to achieve since the financial crisis and with weak
investment. The total volume of international trade grew by
only 2.2% in 2016, which is a half a percentage point less than
what it was in 2015.
Looking at growth performance broken down by country group,
production increases of 2.4% and 1.9% were achieved in the
world’s developed and developing countries respectively in
2016.
One of the principal reasons given for the contraction in
global trade is the failure of the euro area to recover to the
degree expected of it; however ongoing economic and political
problems in the Middle East and North Africa are also cited.
In the Chinese economy, which is one of the principal actors
in global trade, the ongoing process of changing over from
an investment-based to a consumption-based growth model
continues to be the proximate cause of global trade’s weakness.
Having said that however, the recent uptick in protectionist
measures in foreign trade, especially among developed
countries, is also regarded as one of the most important
stumbling-blocks frustrating the recovery in global trade.
The Primary Commodities Price Index was on an upward
trend in the last quarter of 2016.
The energy and industrial metal indexes were up by 9.8%
and 8.9% respectively in the last quarter of 2016, averaging
5.7% more than what they were in the same quarter of the
previous year. Two things that played a decisive role in the rise
in the industrial metal index were increased demand in China’s
construction industry and expectations that there would be a
surge in infrastructure investment in the US in the wake of the
country’s November elections.
Another outcome of those elections was a drop in the gold
price, a downward trend that gained additional momentum
in the second half of December in response to the US Federal
Reserve Bank’s decision to raise interest rates and a relatively
strong performance in oil and other commodity prices. Having
continued to decline without interruption for three years in
a row since 2013, the price of an ounce of gold at the end of
2016 was USD 1,158-only 9% higher than what it had been at
the start of the year.
2.2%
growth rate of international trade
The total volume of international trade grew by only
2.2% in 2016, which is a half a percentage point less
than what it was in 2015.
Growth in the World Trade Volume (2015‑2018)
Realization (%)
Projection (%)
2015
2016
2017
2018
World Trade Volume
2.7
2.2
3.8
3.9
Imports-Developed Countries
3.5
2.4
4.0
4.0
Imports-Developing Countries
3.7
1.9
4.5
4.3
Exports-Developed Countries
3.5
3.4
2.5
3.5
Exports-Developing Countries
3.1
2.1
3.6
4.3
Oil Prices
-47.2
‑15.7
28.9
-0.3
Source: IMF World Economic Outlook, April 2017
Developments in the World and Turkish
Economies
Annual Report 2016
The Association of Financial Institutions
32