GENEVA -- The World Trade Organization on Tuesday said growth in the trade of goods by volume was expected to slow to 2.6% in 2019, from 3.0% last year, highlighting the ripple effects of the U.S.-China trade war and worsening economic conditions in Europe. The growth is the lowest since the rate of 1.6% recorded in 2016.
The figures represent a sharp decline from the six-year high of 4.6% in 2017. In Asia, export volumes grew 3.8% in 2018, down from 6.8% the previous year. Import volumes also fell from 8.3% to 5.0%. In 2019, Asia's export and import are expected to slow further down to 3.7% and 4.6%, respectively.
The WTO initially forecast a 3.9% trade growth rate for 2018. The shortfall was due to a "worse-than-expected result in the fourth quarter", it explained, when the impacts of the U.S.-China trade war began to be felt.
In 2018, the total global trade of goods by value was $19.4 trillion for exports and $19.8 trillion in imports, with both figures up 10% from a year earlier. Despite the slowdown in trade by volume, an increase in the oil price inflated the value of goods exchanged.
China came out on top in terms of the value of goods traded, at $4.6 trillion for the second year in a row. It expanded its model of importing manufacturing equipment and exporting completed products such as smartphones.
The U.S. came in second place with $4.2 trillion-worth of goods traded, followed by Germany and Japan.
The outlook for the trade environment is somewhat cloudy. The U.S. and China imposed extra tariffs on each other's goods throughout 2018. The world's two largest economies are currently in talks to try to ease the tensions of their trade war, but have yet to reach an agreement.
"With trade tensions running high, no one should be surprised by this outlook," said WTO Director-General Roberto Azevedo. "Trade cannot play its full role in driving growth when we see such high levels of uncertainty."