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Briefing

The Recovery of Global Trade Flows

Critical Issues

Will Trade Ministers Conclude the Doha Trade Talks in 2010?

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Will Trade Financing Costs Continue to Ease in 2010?

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Background:

Global trade contracted over 10% in 2009, the first negative annual decline since 1982. With global growth recovery appearing sluggish and trade recovery lagging behind, world trade is expected to remain subdued in 2010. Strengthening commodity prices and Chinese stimulus-related stockpiling temporarily boosted trade in bulk goods in 2009, but the impact was short-lived. Trade in 2009 also received a boost from inventory restocking and fiscal stimulus and these factors might continue to support trade flows until mid-2010. After that, global trade will grow slowly owing to weak private demand, especially in the U.S. and EU, and slow improvement in trade finance. In the coming years, global trade is unlikely to post strong growth rates of the pre-crisis years. Deleveraging in the West might lead to structural changes in global trade flows, and the direction of trade might shift from East-West trade to South-South trade.

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Associated Readings

Analysis CPB Netherlands Bureau for Economic Policy Analysis Jan 26, 2010 World trade monitor: November 2009 Analysis OECD Jan 27, 2010 International Trade Statistics: Trends in Q3 2009 Analysis EIU Feb 01, 2010 World economy: EIU's latest trade assumptions Research IMF Jan 13, 2010 Open Markets Would Support Rebound in Trade in 2010 Analysis Rabobank Dec 22, 2009 Globalization at a crossroads: Challenges for the future Analysis VoxEU Richard Baldwin Nov 27, 2009 The great trade collapse: What caused it and what does it mean? Opinions Financial Times Oct 14, 2009 Analysis VoxEU Caroline Freund Nov 27, 2009 The trade response to global downturns Analysis OECD Stéphanie Guichard and Calista Cheung Oct 29, 2009 Understanding the world trade collapse Analysis VoxEU Nov 27, 2009 The collapse of global trade: Update on the role of vertical linkages Analysis VoxEU Jeffry A. Frieden Nov 27, 2009 Global trade in the aftermath of the global crisis Analysis International Economy September 2009 Collapse in Global Trade News Bloomberg Alistair Holloway and Alaric Nightingale Aug 31, 2009 Shipping Rates Seen Falling 50% on China, Fleet Size Analysis Federal Reserve Bank of St. Louis Cletus C. Coughlin Aug 4, 2009 World Trade: Pirated by the Downturn Analysis World Bank Caroline Freund August 2009 The trade response to global downturns: Historical evidence Analysis Economist Jul 24, 2009 World trade: Unpredictable tides Analysis World Trade Organization Jul 22, 2009 World Trade Report 2009: Trade Policy Commitments and Contingency Measures Analysis IMF Julian di Giovanni and Andrei Levchenko Aug 25, 2009 Putting the Parts Together: Trade, Vertical Linkages, and Business Cycle Comovement Analysis VoxEU Joaquim Oliveira Martins and Sónia Araújo Jul 08, 2009 The Great Synchronisation: What do high-frequency statistics tell us about the trade collapse? Analysis Wells Capital Management Jun 18, 2009 The “New Normal” Will Likely Be … Ahh … Normal!?!