2015 has been a tough year for international trade, as new statistics show this year is on pace to be the worst year for trade since 2009. The numbers were a surprise compared with earlier projections, and have led to worries among some economists about the health of the global economy. The IMF had expected a 3.1% increase in trade volume compared to last year, but through three quarters of 2015, trade has only grown 0.7%. Analysts have highlighted lower demand from the Eurozone as well as an economic slowdown in China as major factors in the low trade numbers.
One place that has seen the effects of the low trade is U.S. ports, where imports fell 10% in August and September, usually the busiest time of the year. The drop in imports has also hurt transport countries around the world, as seen in the increases in bankruptcy filings among shipping companies. Major companies such as Genco Shipping and Trading in the United States and Daiichi Chuo Kisen Kaisha in Japan went bankrupt. The shipping industry is also seeing increases in merger activity, as companies look to survive the loss in trade.
Economists are still split on the overall impact that this year’s low trade will have on the global economy. Some worry about the low export numbers, since the global economy went into a major recession the last time trade numbers dropped so unexpectedly. They fear that the trade numbers are a sign that the global economy is weakening and point to China’s slowing economy and recessions in major emerging markets as evidence. Other economists are taking a more optimistic approach, seeing this year’s disappointing numbers as more of a blip in the radar, pointing toward large built up inventories as a major reason for the lower than expected trade volume.