Preliminary Assessment by the GATT Secretariat

Transcription

1 isi WÊÈBB9BÊBUËËÊËBÊÊBBËÊÊ8BÊËÊB8BË GATT PRESS RELEASE GENERAL AGREEMENT ON TARIFFS AND TRADE ACCORD GENERAL SUR LES TARIFS DOUANIERS ET LE COMMERCE GATT/ February 1970 r INTERNATIONAL TRADE IN 1969 AND TENDENCIES IN 1970 Preliminary Assessment by the GATT Secretariat In 1969j the volume of world production increased by roughly 5 per cent, as against approximately 6 per cent in 1968 and A per cent in In spite of this slight deceleration of economic growth, confined to North America and the United Kingdom, world exports increased by 13-g- per cent in value, more than at any time since the Korean price boom. In value terms, the growth of world trade thus accelerated further from th6 11 per cent recorded in In terms of volume, however, world trade grew at nearly equal rates in both years, since a part of the 1969 value increment was due to a rise in the general level of export prices of some 2-g- per cent. In 1968, in contrast, this level showed a slight decline. Consequently, the increase in the volume of world exports can be estimated at about 11 per cent, 1 per cent less than the 1968 gain which was the largest recorded in the post-war period. In view of the numerous statistical distortions caused by various events (German border tax measures at the cad of 1968, Aineric.n dock strike early in 1969, parity changes in France and Germany, etc.), it is not yet possible to present a complete picture of the development of world trade in the course of I969. If no adjustment is made for thoso distortions, the seasonally adjusted figures-'- would show a depressed first quarter, followed by a sharp acceleration in late spring and early summer. The expansion slowed down somewhat in the third quarter, but in October 1969 the seasonally adjusted imports and exports of the industrial countries were both nearly 25 per cent above their average 1968 level. It seems that, at least as far as imports into industrial countries are concerned, there was a small decline in the closing months of the year. The seasonally adjusted figures quoted below are taken from the "Main Economic Indicators" of the OECD, complemented by some tentative seasonal adjustments for non-industrial countries worked out by the GATT secretariat. SERVICES DE L'INFORMATION, GATT INFORMATION SERVICES, GATT Villa Le Bocage, Palais des Nations, Genève 10 Suisse Téléphone : Cables : GATT-GENÈVE

2 Page 2 The expansion of world trade over the major part of 1969 reflects an unusually fast growth of import demand in all industrial countries - with the exception of the united Kingdom and the United States - combined with a sustained growth of imports into developing areas. The United States and the United Kingdom, which together account for not quite one fourth of world imports, contributed only about one eighth of the growth in world imports in 1969, whereas the EEC, which accounts for nearly one third of world imports, contributed more than one half of the increase. The import growth of Japan, Canada and of the other European countries was about the same as the world average and that of the developing areas only slightly smaller. Trade of industrial areas Contrary to what had happened in previous years, each of the main industrial countries had a somewhat-more even share in the expansion of exports in 1969, the extremes being about 10 per cent for Nor%h America and 24 per cent for Japan-*-, for an average of 15 per cent. This shows that the substantial growth of import demand in all other markets more than offset the effect of the below-average expansion of United Kingdom and United States imports. The consequence of the differentiated import growth combined with the more uniform expansion of exports was, in a number of cases, a significant move towards a better equilibrium in trade balances. Among the deficit countries, the most important improvement took place in the United Kingdom where the visible trade deficit- 5 was reduced iron $3.6 billion in i960 to $2.4. billion in The improvement was somewhat more modest in the United States ($0.9 and $0.4 billion, respectively) whereas among other countries, the Netherlands, Belgium/Luxembourg, Austria, Norway, Portugal, Iceland and 'Turkey, also improved their position. By contrast, the trade deficit of France nearly doubled and in Canada the exceptional 1968 trade surplus gave way to a deficit. Among the surplus countries (in terms of their current account), there has been a reduction in the trade surplus of the Federal Republic of Germany (from C'4.6 billion to $4.1 billion)^ whereas the near balance of Italy turned into a small deficit, still more than offset by the huge surplus on invisibles. The only From 1969, Japan has taken the place of Canada as the fourth trading nation in the world, after the United States, the Federal Republic of Germany and the United Kingdom. The definition of "deficit" countries is xv. terms of their 1968 balance on current account. 3 For the purpose of this note, trade balanças were calculated on an exports f.o.b.-imports c.i.f. oasis. The balances show therefore a smaller surplus (or larger deficit) than those calculated on the balance-of-payments basis (f.o.b.- f.o.b.). At current exchange rates; the reduction measured in DM was by 15 per cent.

3 OTAL TRADE BY AREAS, GATT/1052 Page 3 (Values, Annual Rates of Change in Percentages) EXPORTS IMPORTS Average Average United States Canada Japan S ,2 6, * ,2 1.4, European Economique Community 10,9 6» r! 14,4 (18) , (22) of which: Germany, F.R. France Italy ,8 8*0 4,!? lu ,9 a! , , ,3 23, (20) a European Free Trade Association 2 o 8, (8) of which: United Kingdom Sweden Switzerland ,7 13,4 14,0 (13,9) , ,3 (14.6) 17.3 Total industrial countries 9.1 5,4 12,7 w ,7 (15; Australia, N, Zealand, S. Africa ,2 (13.7) 6.1 7,7 4.5 (7.6) Total developed areas Total developing areas (9) 5»v> (10) Council for Mutual Economic Aid (101) 6,9 8.6 (31) WORLD TOTAL }) (13*) Highly tentative estimates, based on nine months' returns. Sources: OECD, Main Economic Indicators, January 1970; IMF, IFS, January 1970 gnd national statistics N.B.: Figures in brackets are estimates based on incomnle+e returns. The figures for areas are rounded to the nearest half.

4 Page 4 surplus country which further improved its position was Jape./, with ai- unprecedented trade surplus of?!>0.7 billion compared with near balance in These developments resulted in s sigvu.ficart reduction of the combined trade surplus of the European Economic Community contrasting with an even more substantial reduction of the overall trade deficit of the European Free Trade Association as, for the first time since 1966, the rate of growth of EEC exports was not subst xtirj.ly higher than that of EFTA experts, while.efta imports conxinuec to rise much less rapidly. Other developed areas Exports of Australia and i:ew Lealand increased even more quickly tuai, those of industrial areas in 1969: by about one fifth. Those of South Africa (excluding non-monetary gold) appear to have declined slightly. Australian imports have shown little increase in 1969, contrasting with the rapid growth of imports into New Zealand and South Africa. Trade of developing areas Information on trade of developing countries is still highly fragmentary covering generally six to nine months in As a preliminary estimate, it would seem that total exports of developing areas have increased by perhaps 9 per cent in 1969, about the same at in I960. ' _ven the increase in commodity prices, the rise in volume terms './as significantly smaller. It would seem that there has been a slight deceleration in exporte towards the end of the year without, however, any noticeable effect on the level of commodity prices. On the import side, the estimates involve an even larger margin of error because of the considerable acceleration in the late months of For the year as a whole, the growth of impcr+s seems to have somewhat exceeded that of exports, but import prices have also risen significantly. As already noted in 1963, export growth was particularly rapid in Africa, the Middle East, and South and East Asia (between 9 and 11 per cent), whereas Latin American exports rose by approximately 7 per cent. It would seem that, apart from the petroleum exporters, the main beneficiaries of the trade expansion were developing countries having a special interest in the Japanese market, as well as those whose exports comprise a relatively important proportion of manufactures. However, a number of countries have also benefited from the exceptional price increases of certain primary commodities, such as copper, rubber, cocoa and, more recently, coffee.

5 Page 5 In so far as imports arc concerned, the picture has been much more erratic and no clear pattern can be discerned. Depending to a large extent on more or less accidental factors (e.g. harvests), the rates of growth of imports in the first six to nine months of 196Ç have varied considerably from one country to another showing, for instance, a huge increase in Argentina, Hong Kong and Singapore and a substantial decline in India. Judging from the statistics of the OECÛ exports to less-developed trading partners, there has been a sustained rise in the imports of most developing areas in the second half of 1969, with perhaps a quicker rise in Asia, the Middle East and Africa than in Latin America. In spite 01 the rapid rise of the imports oi developing areas, their foreign exchange reserves have continued to increase globally until the end of the third quarter of 1969, though at a somewhat less rapid rate than through Among the major regions, the reserves of the Middle Eastern countries have declined from the first quarter 1969 onwards and those of Africa levelled off in the second quarter. Trade of the Eastern Trading Area Preliminary statistics suggest a sustained growth of total exports of CMEA countries, of the order of 10 per cent in value, in spite of a drop in Czechoslovak exports in the first half of the year. The rates of change of imports varied considerably from one country to another, with large increases in Poland, Hungary and Romania and near-stagnation in Czechoslovakia and Bulgaria. Trade turnover of Eastern Germany (exports plus imports) has risen by 13 per cent, i.e. well above the long-term average, and that of the Soviet Union by 9 per cent, oi slightly less than last year. Ko figures are available on Cuba and Mainland China, but it would ceem that the trade of Mainland China with developed and developing countries has resumed a strong upward trend after three years of stagnation. Prospects for 1970 The development of world trace in 1970 is likely to be shaped by two contrary influences. On the one hand, the economic slow-down in the United States, particularly in the early part of 1970, is likely to depress United States import demand and may thus affect economic activity in some of the countries heavily depending on the United States market. On the ether hand, domestic demand remains quite buoyant in most countries of ucntineitoal Eurcpe and in Japan and it is expected to show s moderate increase in the United i'-ingdom following the marked slow-down experienced in 196y. Tais, together with sustained import demand in the developing countries taken as a group, could permit world exports to register a 4-8 per cent increase in 1970 uver It should be noted, nevertheless, that given the steep increase in the course of 1969, a 6-7 per cent increase of world trade in 1970 as a whole would mean no more than the maintenance of trade flows at their seasonally adjusted peak during the closing months of 1969.

6 Page 6 The slower growth of world trade is likely to be accompanied by further progress towards baiance-of-payments equilibrium among major industrial countries with a reduction of the large surpluses and deficits on current account which have persisted in recent years. There may also be a deterioration in the trade balances of the developing countries as a group, particularly if the current rise in commodity prices is reversed. END