WTO predicts trade growth to slow next year amid crises

GENEVA - The World Trade Organization is predicting global trade volumes will grow a lackluster 1% next year as crises and challenges weigh on markets, including high energy prices, rising interest rates and uncertainties about Chinese manufacturing output amid the lingering COVID-19 pandemic. The Geneva-based trade body said Wednesday that the amount of goods shipped between countries are expected to rise 3.5% this year, up from the 3% that WTO anticipated in its first forecast for the year in April. This year, the higher predicted increase in trade volumes stems from better data that arrived in the middle of the year, contributing to a clearer forecast, and a boom in trade volumes from oil- and gas-producing countries in the Middle East as supplies from Russia were shunned and consuming countries sought alternative sources, WTO economists say. The trade body said that new information from purchasing managers on final goods prices and an index of input prices suggested that inflationary pressures "May have peaked" - a factor that could influence decision-making from central bankers in the months ahead. Shrinking demand and the continued fallout from the pandemic is likely to crimp exports out of China, the world's manufacturing powerhouse, the WTO said. WTO senior economist Coleman Nee said Russia hasn't reported its trade figures to the global trade body since January, clouding the picture about how Russian trade was faring. The WTO - just one of several multilateral organizations that predicts economic output fluctuations - says it expects global gross domestic product to increase by 2.8% this year and 2.3% next year, down from 3.2% predicted in April. "Most regions are set to register faintly positive export growth in 2023, with the exceptions of Africa and the Middle East, where export growth is projected to turn negative after growing strongly this year on the back of heightened demand for oil," Okonjo-Iweala said.