Global trade Asian import growth strong

Post Report

KATHMANDU, May 31 - Global trade and output growth in 2000 were the strongest in more than a decade, with all regions benefiting from the stronger world economy, according to WTO Annual Report-2001 published recently.

According to a press release received here today, which summarizes the findings of the report, merchandise trade expansion in real terms in 2000 matched the best annual rates observed over the last five decades. However, a deceleration of economic growth began in the final quarter of 2000, clouding the trade prospects for 2001.

While all regions reported faster nominal trade growth, exports and imports of developing countries expanded by more than 20%, lifting their share in world merchandise trade to the highest level in the last 50 years. Various factors contributed to this outcome, including the economic recovery in Latin America and East Asia, the sharp rise of oil prices and stronger import demand in developed countries, the release says.

The value of world merchandise trade rose by 12.5% in 2000 — twice the average for the last decade — to reach nearly 6.2 trillion dollars. World commercial services trade is estimated to have expanded by 5% (to 1.4 trillion dollars) in 2000, the fastest annual growth since 1997. For the second year in a row, the value of commercial services trade expanded less rapidly than merchandise trade, but for the 1990-2000 period its 6% annual growth matched that of merchandise trade, says the release.

In 2001, the world economy is retreating from the high growth path seen last year, dimming the prospects for world trade in 2001. The volume of world merchandise trade is expected to grow by 7%, a marked reduction from the estimated 12% in 2000, the release points.

The year 2000 witnessed not only outstandingly high global trade and output growth of 12% and 4%, respectively, but also an exceptionally large excess of trade growth over output growth. Prices of all internationally-traded goods remained almost unchanged from the preceding year as sharply higher prices for fuels were offset by declines in the prices of manufactured goods. In 2000, prices of manufactures recorded the fifth consecutive annual decline, causing average prices to fall to their lowest level in 10 years, the release says.

Real oil prices reached their highest level since 1985 and the share of fuels in world merchandise trade is estimated to have recovered to somewhat more than 10%, close to its share in 1990. The regions with a large share of fuels in their merchandise exports (the Middle East, Africa and the transition economies) recorded outstanding export growth — between 25 and 50% in 2000, according to the release.

Asia’s merchandise import growth was the strongest of all the regions (23.5%) and exceeded for the second year in a row its export growth. North America’s merchandise import growth (18%) was second only to that of Asia and again stronger than its export expansion (13.5%), adds the release.

The growth in the dollar value of Western Europe’s merchandise exports and imports was by far the lowest of all regions, largely due to the further depreciation of the euro and other European currencies vis-à-vis the dollar. North America and Latin America recorded both double digit export and import growth for commercial services, the release says.

Asian exports of commercial services rose by 13% boosted by the marked acceleration of services export growth by Asia’s three leading exporters: Japan; Hong Kong and China. The near stagnation of Japan’s services imports — which accounts for one third of the Asian regional total — was the principal factor in the subdued expansion of Asia’s commercial services, says the release.

Expressed in euros, Western Europe’s commercial service trade expanded by about 14% which indicates an acceleration in both nominal and real terms. In dollar terms, however, Western Europe’s commercial exports and imports decreased slightly.

In the oil markets, the sharp oil price variations which, over the last three years recorded their highest and lowest levels in 15 years, have left their mark on international trade flows. The share of fuels in world merchandise exports fell to 6.5% in 1998, the lowest share in three decades but recovered to 10.5% in 2000, the release points.

The swings in oil prices have had a dramatic impact on the export earnings of oil exporters. At least 18 fuel exporters recorded total merchandise export growth in excess of 50% and in 2000. For about 30 countries fuels account for more than one third of their merchandise exports. While the developing countries (and also the LDCs) are — as a group — net fuel exporters, the majority of the developing countries are net-importers, the release states.

In the second half of the 1990s, Asia replaced Western Europe as the largest net-importing region. This development can be attributed to the buoyant rise of fuels imports into fast growing developing Asia. The Middle East consolidated its position as the world’s leading fuel exporter and is likely to strengthen it further in the future, the release concludes.

Call for an end to digital divide

JAKARTA, Indonesia, May 31 (AP) - Can you have your Internet and ethics, too?

Developing countries hope so - they urged the wealthy world Thursday to help them close the gap in information technology while seeking shelter from what some see as the evils of free flowing information.

The 11th annual summit of the Group of 15 developing nations, which has expanded to 19 countries since it was founded in 1989, ended Thursday with a declaration calling for an end to the digital divide.

According to summit host Indonesia, of the world’s 6 billion people, less than five percent have access to the Internet, nearly all of them in developed countries. The gap mirrors fears of many countries that the rich benefit from globalization while the poor get left further behind.

But while leaders from Africa, Asia and Latin America meeting here this week hoped to accelerate economic development and see the high-tech highway as a new way to get there, some are wary of potholes.

"Due attention should be given to the preservation of cultural diversity, privacy and other aspects of ‘info ethics," the declaration said. "We call upon the international community to bear these aspects in mind in dealing" with information technology issues.

The declaration presented a watered-down version of the views of President Robert Mugabe of Zimbabwe, one of the few original founders of the G-15 still in office and under increasing international criticism for his repression of opposition critics and news media.

Mugabe, who once banned works with homosexual themes from a book fair in his country, said Wednesday that regulatory steps were needed to stem destructive information from poisoning G-15 societies.

"We observe, with dismay, the threat which the free information era poses to the sanity and purpose of our national communities, families, traditions and morals," Mugabe said.

The evils he cited included pornography, disinformation, the popularization crime and "character assassinations of public office holders and governments."

Iran, ruled by an Islamic fundamentalist regime since 1979, chimed in Thursday and offered to host a meeting of G-15 countries to refine the concept of ethics for the new I-revolution.

Iranian First Vice President Hassan Haabibi, said that the group needed to take an "active stance on the issue and let its voice be heard in international discourse and decisions on this subject."

The G-15 countries include a few, like Indonesia, where a muzzled media became freewheeling in recent years due to the advent of democracy, to nations like Iran, Zimbabwe and Malaysia, whose leaders made the New York-based Committee to Protect Journalists’ Top 10 enemies list this year.

Malaysian Prime Minister Mahathir Mohamad, whose press is kept on a leash by licensing, sedition and libel laws, hopes to turn his Southeast Asian country into a world-class center for high-technology and has pledged to leave the Internet alone.

But critical opposition Web sites have been disrupted and an award-winning independent news site, Malaysiakini.com, has come under repeated criticism from officials.

"On the Web sites you can read all the nasty things they say about Malaysia, but that is the usual thing you expect to find," Mahathir said Thursday.