The Future of Trade: Are we ready to embrace the opportunities?
A new paper examines how trade will continue to be critical for the future prosperity of Australia and New Zealand.
Trade has recently come under greater scrutiny, with the US election and Brexit highlighting voters’ opposition to the integration of their nations’ economies into the global economy.
Yet international trade is essential to our modern economy. It gives us access to a wider range of goods and services, stimulates competition and allows us to focus on areas of comparative advantage. In Australia and New Zealand, exports account for 20% and 28% of GDP respectively.
A PERIOD OF GROWTH … UNTIL THE GFC
Between 1985 and 2007, international trade grew, on average, twice as fast as world GDP. This was spurred by rapid growth in industrialising Asian economies, which increased demand as well as introducing new global producers.
Reductions in the costs of trade, in particular transport and communication, greased the wheels. It enabled new business models and a shift to global supply chains. Liberal trade policies proliferated and further strengthened trade flows, as many countries saw trade as a means of bolstering economic growth.
After the Global Financial Crisis, however, international trade slowed, keeping pace with global GDP growth.
THE TIDE IS TURNING
In 2016, we saw improvements in container volumes, rising orders for manufacturing globally and an increase in the number of businesses going global – all good early indicators for trade.
Looking forward, the key factors in determining the future rate of growth in international trade will be:
The publication The Future of Trade analyses the results of a survey of 1,500 Australian and New Zealand businesses in order to understand the characteristics of trading businesses, how and with whom they currently trade, and their perceptions of trade in the future.
Article by Future Inc – Perspectives on Prosperity | March 2017
Learn more about the trends, insights and forecasts on globalisation, exports, and technology in The Future of Trade report. To read the full report, click here.