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Do global trade figures signify a slowdown in globalization?
A further suggestion that the pace of globalization has slowed came this week, when the World Trade Organization (WTO) predicted that 2015’s growth in global trade would represent only a moderate rise on that of 2014.
Global trade grew by 2.8% in 2014 and WTO expects a 3.3% rise this year, a figure that is beneath the IMF’s predicted 3.5% growth in the global economy as a whole – an estimation that was also released this month.
If these figures are accurate it would be the fourth straight year in which global trade has grown at or below the rate of the global economy. However, pre-2008, global trade was often found to be growing at double the rate of the global economy, and was dubbed by many as an era of ‘hyperglobalization’.
Director-general at the WTO, Roberto Azevêdo, described the growth in recent years as a ‘gloomy picture’ and blamed the lingering effects of the financial crisis in a press release, but he also pointed to how he believed the situation can be improved upon.
“Trade can be a powerful policy tool to leverage economic growth and development. By withdrawing protectionist measures, improving market access, avoiding policies which distort competition and striving to agree reforms to global trade rules, governments can boost trade and seize the opportunities that it offers for everyone,” Azevêdo said.
However, the WTO also projected a tentative rise to 4% growth in global trade for 2016 – something that is only marginally larger than the IMF’s global economy growth estimation of 3.8%.
‘Subdued prospects’ trouble global economy
Meanwhile, growth in the global economy was described as "moderate and uneven" last week by the IMF’s managing director, Christine Lagarde. Olivier Blanchard, IMF research director and a macroeconomist on leave from MIT, wrote of “ageing and weak productivity” limiting growth potential in an analysis this week, while highlighting that “subdued prospects” that culminate in lower spending and growth are a more accurate description than talk of stagnation.
The challenge for entrepreneurs and SMEs: Access to finance
Entrepreneurs operating small and medium-sized enterprises (SMEs) need a greater amount of funding options at their disposal if they are to make good on their potential to drive economic growth and avoid the pitfalls of volatility in the credit market, according to two new OECD reports.
“Small and medium-sized enterprises play a vital role in driving economic growth and creating jobs, but access to finance for these firms will remain a challenge for years to come,” OECD secretary-general, Angel Gurría, said in a press release.
‘Financing SMEs and Entrepreneurs 2015: An OECD Scoreboard’ found that, in a number of countries, bank lending as well as venture capital investment were still to return to levels seen prior to the financial crisis – factors that have hindered the growth of small businesses in particular. The report did note, however, that alternative sources of funding, such as crowdfunding, were growing in popularity among entrepreneurs.
The question of funding options for entrepreneurs was taken further in ‘New approaches to SME and entrepreneurship financing: Broadening the range of instruments’. Here, the conclusion came that SMEs would benefit from diversified funding sources at different stages of their development. Financing techniques discussed include asset-based finance and hybrid instruments.
Explosion of smartphone usage in Latin America
Latin America witnessed the world’s largest growth in smartphone usage between 2013 and 2014, with a 59% rise in sales across the region, according to GfK Group research presented by AS/COA (Americas Society/ Council of the Americas).
Brazil has the highest smartphone usage, by volume, with an estimated 38.8 million users – ahead of Mexico with around 28.7 million. However, in terms of the proportion of a population that now has access to smartphone technology, Chile is currently leading the way.
Almost half of Chile’s population now carries a smartphone, according to eMarketer data, ahead of the estimated 45% of the population in Colombia. Brazil’s proportion stands at 28% - a little under the regional average of approximately 32%, or just under one in three. Smartphone usage in Peru is at about this regional average level, but the number of users is expected to double by 2018.
Following on from the Summit of the Americas, held in Panama last week, the Council of the Americas is gearing up for its Annual Washington Conference on the Americas, held with the US Department of State. This year’s conference, which will take place next week, April 20 to 21, focuses on the topics of sustainable growth and regional integration. Business leaders, such as Telefónica Hispanoamérica CEO Eduardo Caride, will be in attendance alongside political leaders, including US secretary of state, John Kerry, and president of Honduras, Juan Orlando Hernández.
Tim is a writer with a background in consumer journalism and charity communications. He trained as a journalist in the UK and holds degrees in history (BA) and Latin American studies (MA).
Business News Weekly Roundup: April 17 2015
By Tim Dhoul
Updated December 6, 2019 Updated December 6, 2019Do global trade figures signify a slowdown in globalization?
A further suggestion that the pace of globalization has slowed came this week, when the World Trade Organization (WTO) predicted that 2015’s growth in global trade would represent only a moderate rise on that of 2014.
Global trade grew by 2.8% in 2014 and WTO expects a 3.3% rise this year, a figure that is beneath the IMF’s predicted 3.5% growth in the global economy as a whole – an estimation that was also released this month.
If these figures are accurate it would be the fourth straight year in which global trade has grown at or below the rate of the global economy. However, pre-2008, global trade was often found to be growing at double the rate of the global economy, and was dubbed by many as an era of ‘hyperglobalization’.
Director-general at the WTO, Roberto Azevêdo, described the growth in recent years as a ‘gloomy picture’ and blamed the lingering effects of the financial crisis in a press release, but he also pointed to how he believed the situation can be improved upon.
“Trade can be a powerful policy tool to leverage economic growth and development. By withdrawing protectionist measures, improving market access, avoiding policies which distort competition and striving to agree reforms to global trade rules, governments can boost trade and seize the opportunities that it offers for everyone,” Azevêdo said.
However, the WTO also projected a tentative rise to 4% growth in global trade for 2016 – something that is only marginally larger than the IMF’s global economy growth estimation of 3.8%.
‘Subdued prospects’ trouble global economy
Meanwhile, growth in the global economy was described as "moderate and uneven" last week by the IMF’s managing director, Christine Lagarde. Olivier Blanchard, IMF research director and a macroeconomist on leave from MIT, wrote of “ageing and weak productivity” limiting growth potential in an analysis this week, while highlighting that “subdued prospects” that culminate in lower spending and growth are a more accurate description than talk of stagnation.
The challenge for entrepreneurs and SMEs: Access to finance
Entrepreneurs operating small and medium-sized enterprises (SMEs) need a greater amount of funding options at their disposal if they are to make good on their potential to drive economic growth and avoid the pitfalls of volatility in the credit market, according to two new OECD reports.
“Small and medium-sized enterprises play a vital role in driving economic growth and creating jobs, but access to finance for these firms will remain a challenge for years to come,” OECD secretary-general, Angel Gurría, said in a press release.
‘Financing SMEs and Entrepreneurs 2015: An OECD Scoreboard’ found that, in a number of countries, bank lending as well as venture capital investment were still to return to levels seen prior to the financial crisis – factors that have hindered the growth of small businesses in particular. The report did note, however, that alternative sources of funding, such as crowdfunding, were growing in popularity among entrepreneurs.
The question of funding options for entrepreneurs was taken further in ‘New approaches to SME and entrepreneurship financing: Broadening the range of instruments’. Here, the conclusion came that SMEs would benefit from diversified funding sources at different stages of their development. Financing techniques discussed include asset-based finance and hybrid instruments.
Explosion of smartphone usage in Latin America
Latin America witnessed the world’s largest growth in smartphone usage between 2013 and 2014, with a 59% rise in sales across the region, according to GfK Group research presented by AS/COA (Americas Society/ Council of the Americas).
Brazil has the highest smartphone usage, by volume, with an estimated 38.8 million users – ahead of Mexico with around 28.7 million. However, in terms of the proportion of a population that now has access to smartphone technology, Chile is currently leading the way.
Almost half of Chile’s population now carries a smartphone, according to eMarketer data, ahead of the estimated 45% of the population in Colombia. Brazil’s proportion stands at 28% - a little under the regional average of approximately 32%, or just under one in three. Smartphone usage in Peru is at about this regional average level, but the number of users is expected to double by 2018.
Following on from the Summit of the Americas, held in Panama last week, the Council of the Americas is gearing up for its Annual Washington Conference on the Americas, held with the US Department of State. This year’s conference, which will take place next week, April 20 to 21, focuses on the topics of sustainable growth and regional integration. Business leaders, such as Telefónica Hispanoamérica CEO Eduardo Caride, will be in attendance alongside political leaders, including US secretary of state, John Kerry, and president of Honduras, Juan Orlando Hernández.
This article was originally published in April 2015 . It was last updated in December 2019
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Tim is a writer with a background in consumer journalism and charity communications. He trained as a journalist in the UK and holds degrees in history (BA) and Latin American studies (MA).
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