According to the report published by the United Nations Conference on Trade and Development, the growth of world trade is expected to decrease in the first quarter of 2023.

What does it mean?

Global trade is set to reach a record $32 billion in 2022. Among them, trade in services increased by 15% to $7 billion, and trade in goods increased by 10% to $25 billion. However, in the first quarter of this year, the growth of trade in goods is expected to slow down and increase by only 1%.

Factors

Let’s look at the factors that strengthen and support the growth of foreign trade.

• ⬇️ Due to the geopolitical situation and the increase in inflation and interest rates, the countries’ foreign trade is limited. Last quarter alone, the exports of East Asian countries decreased by 7%. In addition, the bad relationship between America and China is a big barrier.
• ⬆️ Trade in green goods such as electric cars, non-plastic packaging and wind turbines will reach a record $1.9 trillion in 2022, supporting foreign trade. In the future, the trade of this type of goods and services will increase in this quarter.

In Mongolia,

Mongolia’s foreign trade turnover in February reached $1.7 billion, which is a 5.1% decrease from the previous month and a 24.8% decrease from December 2022. This was influenced by the fact that the amount of imports decreased by 25.8% from the previous month. In other words, currency depreciation makes goods and services more expensive, reduces demand, and reduces foreign trade. In addition, the MNT exchange rate is expected to continue to weaken in this quarter. So, the growth of foreign trade will slow down in the first quarter as well.

Source: lemonpress.mn