(Bloomberg Markets) — Amid U.S.-China trade talks, policy uncertainty put a dent in global trade, with prolonged tensions pointing to a slow recovery in 2020. The pain has been acute in Asia, where manufacturing, already in a slowdown, fell into a tailspin as companies held back on investment and reworked supply chains. Elsewhere the mood turned dark; in Germany, for example, business managers digested Trump tariff threats. Here we’ve tracked some key gauges that speak to the health of global trade and where things are headed. For more, check out Bloomberg’s Trade Tracker at NI TRADETRACK.
Where Trade Matters Most
Economies in Asia have pushed ahead on trade deals, finalizing regional pacts and negotiating bilaterally among themselves and with partners in Europe and the Americas. Some growth engines in Asia have championed open markets, even in the face of populist pressures there. High reliance on trade carries risks: Some of these nations could see growth suffer greatly in an all-out trade war.
Who’s Ahead in Global Trade?
Economists differ over whether a trade gap is a bad sign, but they see some of its causes as a weight on GDP.
Where Brexit Casts the Longest Shadow
The European Union is preparing to navigate the most complex negotiation in its history: its future relationship with the U.K. The EU wants to form a zero-tariff, zero-quota relationship, protect the single market, and defend regulatory standards.
Shipping Costs Ease as Trade War Cools
Prices have vacillated on concerns over new regulations, trade tensions, and capacity, but ended 2019 about even.
Conflict Swayed Shipping Volumes Around the World
U.S. container imports are still recovering from the U.S.-China trade war. Hong Kong’s political crisis is weighing on the region’s economy and depressing port activity. Singapore has benefited.
Purchasing Managers’ Spirits Lifted Toward the End of 2019
Purchasing managers in the U.S. and China have shown tariff threats can rattle their export outlook. In Germany, Europe’s manufacturing leader, the U.S.-China trade war, Brexit, and other negative risks have given executives quite gloomy expectations for demand. Singaporean sentiment about electronics has been a bit steadier.
A Critical Market for Asia Shows Signs of a Rebound
Electronic goods and components make up as much as a third of Asia’s exports, economists say. The sector’s slump appeared to have bottomed out by late 2019. The question now is how enduring the recovery turns out to be.
Rise of the Green Trade Deal
Environmental provisions are increasingly featuring in trade negotiations. Freer trade can bolster economic growth and development, allowing governments room to focus on environmental issues, according to an analysis by HSBC. Market access can also boost trade in environmental goods and services, which could play a role in lifting environmental standards globally, the HSBC analysis suggests. One way to incorporate Mother Earth in trade deals could be a carbon tax on certain imports.
—With Eric Martin, Jana Randow, and Sam Kim
To contact the authors of this story: Michelle Jamrisko in Singapore at email@example.comEnda Curran in Hong Kong at firstname.lastname@example.orgLee Klaskow in Skillman at email@example.comRichard Bravo in Brussels at firstname.lastname@example.org
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