While the world economies are set to overcome the turbulence of the COVID-19 pandemic and tariff wars between the giants, global trade is all set to climb heights.
The growth prospects of global trade in the past years have already shown that the world’s oceans will witness a lot of freight movement. More and more countries are opting for open economies. With the advancement in transportation and shipping, logistics no longer remains the challenge it used to be in earlier times.
Even the global players in logistics intelligence like Newton Buying Corp agree that globalization is set to gather pace despite the frictions in international trade, leading to the expansion and extensivity of such trading.
Therefore, by considering multiple global import-export data parameters, such as total trade across the countries, trade deficits, time taken in shipments, most traded goods, and markets generating the highest revenues, we can arrive at a few conclusions.
This article discusses five significant predictions of global trade based upon the analysis of global trade databases. Let’s begin.
- Turbulences are Here to Stay, But Trade Will Find a Way
The United States trade policy took unexpected turns in the recent past. We saw the World Trade Organization (WTO) losing its say as the USA enforced its ‘America First’ policy. While the top leadership has now changed, the global trade data involving the economic giant has a lot to say about the future of global trade.
The imposition of trade duties on specific products from target countries had the exporters searching for new markets. While some may choose the path of negotiation, the others have already set on a path of exploration, and we can see the forging of new trade relations between countries that haven’t shared trade relations in the past.
The global import-export data reveals that many new trade agreements were signed, and we can witness many more in the future. As they say, every closed door leads to the opening of a new one!
- New Trading Channels are a Win-Win for Everyone
Be it China’s ambitious belt and road initiative or the blue dot network, which is the proposed counter by the USA and its allies, Global trade shows that international trades are taking new paths, and they love it. While the maritime chokepoints are set to witness regular traffic in the future, we can see many new ones coming up.
It can be a direct consequence of advancements in transport technology or the will of businesses to travel further and deeper to find new markets. However, one thing is sure, more trading channels are bound to come up in the future, and it will serve as a major force multiplier to global trade.
- Trade Agreements Will Lead to Savings
We also saw multiple Free Trade Agreement (FTA) talks between significant economies, the most popular ones being the USMCA (United States of America, Mexico, and Canada), US-Japan FTA, EU-Singapore FTA, among others.
As per a study using the tools by Newton Buying Corp, free trade agreements are an effective way to minimize the duty costs for international businesses. They also help get through the cross-border barriers. With these barriers getting out of view, global trade is set to pick up the pace.
The administrative challenge regarding the FTAs is well known, but it can be eradicated by automated solutions, which further can optimize the compliant FTA use.
- Climate Legislations: A Challenge?
What was previously viewed as a hot topic for debates in international forums has finally entered the scene in the form of climate legislation. In the coming future, the sustainability talks are set to grow only. We will see additional responsibilities for the global trading companies who will have to screen their products for carbon content.
The current global import-export data generated multiple insights regarding the future of global trade. It is an unavoidable fact that multiple traders across the world are engaged in trading goods with higher carbon content, or their training practices are not suitable for a sustainable future.
Therefore, the climate legislation will prove to be a challenge for traders worldwide, and they must work out a feasible solution before it starts taking a substantial toll.
- E-Commerce Will Get More Regulated
E-commerce businesses were a significant development in the recent past. If you compare the global shipment data against international e-commerce orders, you will realize that shipments across the countries increased with the number of e-commerce orders.
However, many countries are set to regulate the e-commerce market, including the depiction of the country of origin, qualitative factors, supplier details, etc. While the e-commerce industry will pick up pace in the future, the businesses will have to develop a solution to adhere to the new regulations.
How is the Overall Picture?
While the world economies are set to overcome the turbulence of the COVID-19 pandemic and tariff wars between the giants, global trade is all set to climb heights. Indeed, businesses that will maintain their trust in the data and information will soar ahead!