Pace of growth declines further for Japanese trade
The DHL Global Trade Barometer, an early indicator of global trade developments calculated using Artificial Intelligence and Big Data, predicts that Japan’s trade levels will contract in near term, with the country’s index value decreasing by five points to 48 points — below the no-growth threshold of 50 points on the Index. The negative growth stems primarily from shrinking air trade across industries, though certain core sectors like automobile manufacturing are expected to remain relatively strong and offset the significant decline in other export areas.
“Despite a contraction in the forecast for the next three months, Japan’s trade outlook remains relatively robust thanks to the strong base provided by core industries such as automotive manufacturing, machinery and technology,” said Charles Kaufmann, CEO North Asia South Pacific, DHL Global Forwarding. “Exports for land vehicles & parts look set to make notable contributions to trade growth off the back of industry consolidation and greater investment in electric and self-driving vehicles. We also see the upcoming Tokyo 2020 Olympic Games contributing to the bullish outlook for imports of basic raw materials over the next quarter, with the Games expected to have positive impacts on the Japanese economy across the board.”
Steady but mild decline negatively affects all countries, except India.
The Barometer’s results also suggest that world trade is expected to continue at moderate pace but further contract for the next three months, driven by minor decreases in both air and containerised ocean trade. Against previous quarters this year, the downward trend in trade growth remains mostly stable, neither indicating an acceleration of the decline nor a bottoming out of contractionary movement. All seven nations monitored by the Barometer received indexes below 50 points except for India, where the Barometer forecasts moderate growth of five points to 54 points for India. While Japan and the UK had been the only countries with positive trade outlooks in the previous update in September, the two countries record the highest losses in this period.
“According to the DHL Global Trade Barometer the year will probably end with moderate world trade. However, we’ve to bear in mind where we come from: The rapid growth world trade has undergone in recent years was like climbing the Mount Everest. Now, we are on the descent, but we are still breathing altitude air”, Tim Scharwath, CEO of DHL Global Forwarding, Freight, says. “A countless number of stable trade relations continues to flourish worldwide, despite smouldering trade conflicts and geopolitical uncertainties.”