Global Trade is in for a Rough 2023 After Record Highs in 2022
Despite high inflation and global supply chain issues, trade rose significantly in 2022. According to a report released Tuesday by the United Nations Conference on Trade and Development (UNCTAD), the value of global trade is expected rise 12% to almost $32 trillion this year.
The significant rise in trade was due to strong growth in the first half of 2022, per Fortune. "Trade in merchandise goods, or the value of material goods moving in and out of the country, rose 10% year over year, reaching $25 trillion," reads the article. Services trade increased by 15% over 2021 to $7 trillion.
Global trade, however, weakened in the second half of 2022 due to deteriorating economic conditions and rising uncertainties, per the UNCTAD report. "The ongoing trade slowdown is expected to worsen for 2023. While the outlook for global trade remains uncertain, negative factors appear to outweigh positive trends," reads the report.
The report forecasts lower economic growth in 2023 due to high energy costs, rising interest rates, inflation and negative economic spillover from the war in Ukraine. Demand for global goods is expected to continue its downward trend.
