The Week in Trade: Global stats falter, Red Sea crisis escalates and waiver 999L is phased out

Fri 12 Jan 2024
Posted by: Danielle Keen
Features

Newspapers with coffee

The Red Sea crisis has dominated headlines and the global picture for trade, with new statistics from the Kiel institute offering a pessimistic view of global trade in the past few months and the World Bank predicting equally poor economic returns for the immediate future.

The big picture: A gloomy week for global growth forecasts saw the World Bank revising down its 2024 growth predictions from 2.6% to just 2.4%.

A combination of major conflicts, tightening monetary policy and weaker trade have contributed to the poorer outlook, with China’s ongoing economic problems expected to trickle down to developing countries.

Good week/bad week: Amid a bleaker picture for world trade, China posted stronger export figures last week, with an increase of 2.3% recorded between November and December.

However, this is far from enough to save the Chinese economy from ongoing strife, with sky-high youth unemployment and a stagnant property market contributing to a bad week for consumer demand, with new stats showing December marked a third consecutive month of deflation. China’s CPI fell 0.3%, while its producer index dropped 2.7%.

How’s stat? 1.3%. The fall in world trade recorded by the Kiel Institute for the World Economy between November and December last year.

Unsurprisingly, the research centre attributed this fall to the reduction in shipping following sustained attacks by Houthi rebels on commercial shipping vessels, Reuters reports.

It found that the number of containers shipped through the Red Sea fell from 500,000 to 200,000.

The week in customs: Importers, we’re rapidly heading towards the end of waiver code 999L on 31 January. This will be replaced by new codes that you can read about here. Any pre-lodged declarations made using 999L before this date will be rejected, if they arrive after 31 January, so make sure you’re using the new codes.

Quote of the week: “A lot of analysts have had the extremes beaten out of them. The last few years have proven that it is so hard to keep up.”

Mark Wilson, analyst at investment bank Jeffries, speaking to the FT about the stable oil price outlook in the wake of Saudi Arabian oversupply. A reminder to expect the unexpected as we head into a year of major political upheaval and a point well-proved by the oil price jump that followed western intervention in the Red Sea crisis.

What else we covered this week: As the Red Sea crisis continues apace, escalating with US and UK strikes against Houthi rebels, Phillip Adnett is keeping you posted with a series of updates on the region. He also looked at five less discussed elections taking place this year that might affect trade.

Benjamin Roche reported the findings of the World Economic Forum’s Global Risk Report, which offers an annual survey of the biggest threats to the global economy.

Danielle Keen watched levelling up secretary, Michael Gove, discuss freeports and investment zones, while Richard Cree delved into trade news down under, with a look at all the latest stories from Australia and New Zealand.

True facts: This week marks the founding of some of the modern era’s key organisations for promoting international cooperation, including the post-World War I establishment of the League of Nations on 10 January 1920.

Set up to prevent future cataclysmic conflicts, the League’s peace-keeping duties were eventually reembodied in the United Nations, after what can only be considered its definitive failure: World War II. The UN held its first meeting of the General Assembly on the same day – 10 January – in 1946.

A story to make us all reflect on the strength of our New Year resolutions, and feel slightly better about their outcomes.