Credit support key for global trade, ECB says
Global trade growth, vital to the health of the world economy, will be affected by credit, economic corrections and support for globalisation, the European Central Bank said on Thursday amid warnings of a simmering trade war.
But at least "there is little evidence that global trade integration has been hindered by the financial crisis," the ECB added in its monthly bulletin for October.
The report was published two days after German Economy Minister Rainer Bruederle warned in Beijing: "The danger of a trade war has appeared on the horizon," as several countries moved to control the value of their currencies.
China and Germany are the world's two leading exporters and curbs to trade could have a significant impact on their economies.
The ECB bulletin noted that global trade has rebounded sharply since the financial crisis, recovering more than 14 percent from a trough in the second half of 2009 after plunging by around 15 percent in late 2008 and early 2009.
But the overall level of trade was still below that recorded "before the intensification of the financial crisis" in 2008, it said.
Government stimulus like car scrapping premiums have boosted trade but many measures are being unwound and companies have done much of the restocking that also underpins global commerce.
"Looking ahead, trade levels are likely to remain below their pre-crisis trajectory for some time to come," the ECB said, in part owing to tighter credit conditions.
With lending standards "unlikely to return to pre-crisis standards in the near future, persistent repercussions on the level of trade cannot be ruled out," it warned.
In the longer term, trade would nonetheless expand "as emerging economies continue to integrate rapidly into the world economy," the central bank said.
Emerging countries accounted for 82 percent of the world's population last year and they "are playing an increasingly important role for the global economy and for the euro area in particular," the ECB noted.
"The share of emerging economies in world GDP (gross domestic product) is already 45 percent, almost 10 percentage points higher than in the early 1990s," it said.
According to the IMF, this share should surpass 50 percent in 2013, the ECB added.
© 2010 AFP