Trade Slows in Asia Pacific: UN Report

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According to Asia-Pacific Trade and Investment Report 2015, the regional trade and investment flows in Asia and the Pacific is decelerating as the economies in the region adjust to cyclical and structural changes resulting from the global economic downturn and the expected reduction in China’s growth rate.

The Report was compiled by the UN Economic and Social Commission for Asia and the Pacific (ESCAP).

It says that the Asia-Pacific remains the most dynamic region of the global economy and will continue to hold its position as the largest trading region in the world.

current affairsAccording to the report’s analysis of the latest regional trade and investment outlook in the region, total exports and imports from the region grew by only 1.6 per cent in 2014. When China is excluded from the regional total, exports from the Asia-Pacific region registered a decline of 0.4 per cent.

The report further states that any possibilities of a merchandise trade recovery could suffer if the sluggish pace of trade and investment growth in the region continues.

Despite the slow pace, the report says the Asia-Pacific region stands out for its significant and sustained achievements in leveraging trade and investment flows for development.

The report, underscores the importance of reviving trade and investment to implement and meet the recently adopted Sustainable Development Goals (SDGs).

The production fragmentation across the world as part of Global Value Chains (GVCs) has opened new opportunities for developing countries to integrate in global trade.

According to the report, Asia and the Pacific accounted for nearly 40 per cent of global exports and imports in 2014, while intra-regional imports remained at a little over 50 per cent of the total in 2014, with intra-regional exports at 54 per cent.

Further, the report indicated that the outlook for regional services trade was better than for merchandise trade as exports of services in the region increased at 5.1 per cent in 2014, compared to 4 per cent in 2013.

The report evaluated that exports of travel and other commercial services were especially strong, supported by growing demand for travel by China.

Additionally, the report shows that trade facilitation measures, including implementation of the WTO Trade Facilitation Agreement, can help reduce trade costs as many countries in the Asia-Pacific region are getting on with implementing trade facilitation measures ahead of the Agreement’s ratification.

It highlights that increasing use of trade-restrictive measures such as non-tariff measures have detrimental consequences for the region’s least developed countries, presenting particular obstacles to small- and medium-sized exporters.

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