Asean to top export growth

Asean to top export growth

Bloc forecast to see 5.6% gain till 2026

Mr Pearson says trade has the power to reduce inflation and diversify inputs.
Mr Pearson says trade has the power to reduce inflation and diversify inputs.

Asean is expected to lead the world in terms of export growth from 2021 to 2026, followed by South and Central Asia, according to a report by global logistics provider DHL.

Asean is forecast to see 5.6% export volume growth over the five-year period, trailed by South and Central Asia at 5% and sub-Saharan Africa at 4.4%.

These three regions are "new poles" of trade growth, based on the new DHL Trade Growth Atlas report, which gauges important trends and prospects for global trade, covering 173 countries.

Asean and emerging markets will play a larger role in global trade in the future, according to the report.

"Trade will remain a key driver of prosperity, as it has been for centuries," said John Pearson, chief executive of DHL Express.

"International trade is considered especially important now because of its power to accelerate economic growth, reduce inflation and enable countries to diversify sources of key inputs for economic resilience."

He was speaking during the introduction of the report, jointly conducted and published by DHL and New York University's Stern School of Business.

According to the research, the pandemic has not been a major setback for global trade as earlier expected, with international trade in goods surging as high as 10% above pre-pandemic levels.

Despite the Russia-Ukraine war, the recent forecasts indicate global trade is expected to grow slightly faster in 2022 and 2023 than it did over the preceding decade.

E-commerce saw surging sales during the pandemic and strong cross-border e-commerce growth is forecast to continue, according to the report.

Global cross-border e-commerce sales are expected to reach US$1 trillion in 2030, up from $300 billion in 2020.

"The trade landscape is shifting and presenting new challenges, but this report strongly rebuts predictions of a major retreat from global trade," said Steven Altman, senior research scholar and director of the DHL Initiative on Globalization at NYU Stern's Center for the Future of Management.

Regarding emerging economies, the report indicates they are becoming increasingly important exporters of sophisticated capital goods, such as industrial equipment and engines.

Trade growth is spreading out across a wider variety of countries. From 2016 to 2021, China generated one-quarter of the world's trade growth.

Based on an IMF forecast, the report said China will still achieve the most trade growth from 2021 to 2026, but its share of global growth will fall to 13%.

According to the report, Vietnam, India and the Philippines stand out on both the speed and scale of projected trade growth through 2026 as many companies diversify from China-centric production and sourcing strategies.

The world is facing geopolitical challenges that affect supply chains and the regionalisation of supply chains may happen in the next five years, Mr Altman said.

Andrew Wilson, global policy director of the International Chamber of Commerce, said barriers in emerging markets make it difficult for e-commerce to accelerate despite high potential.

He said small merchants still handle their business on paper, making it difficult for them to enter the full digital space.

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