WTO: Global Goods Trade continues recovery
As per World Trade Organisation’s (WTO) Goods Trade Barometer, Global merchandise trade is continuing its robust recovery post COVID-19 pandemic. The trade barometer hit a record high in its latest reading.
- Barometer recorded a reading of 110.4. It is the highest on record since July 2016.
- Reading was up more than 20 points year-on-year.
- This reading will end up well for India because India’s exports are recording healthy growth rates.
- Rise in barometer highlights the strength of current trade expansion as well as depth of the pandemic-induced shock in 2020.
- It also indicates that goods trade will observe year-on-year rise in the second quarter.
- It also suggests that outlook for world trade will be overshadowed by risks like regional disparities, weakness in services trade, and lag in vaccination timetables.
Goods Trade Barometer
The Goods Trade Barometer was launched in 2016 by the WTO. It combines several trade-related component indices into a single composite index. It highlights the turning points in world merchandise trade as well as provides an indication for its trajectory in near future. It shows how latest data compare with short-run trends in goods trade. It was earlier known as World Trade Outlook Indicator.
How it indicates the trajectory?
Reading of 100 indicates for trade expansion in accordance with the recent trends. While, readings greater than 100 indicates above-trend growth. Readings below 100 suggests below-trend growth.
How this barometer is updated?
It is updated on a quarterly basis.
World Trade Organization (WTO)
It is intergovernmental organization, involved in regulating and facilitating international trade between countries. It officially started its operations on January 1, 1995 after the 1994 Marrakesh Agreement. It replaces the General Agreement on Tariffs and Trade (GATT). WTO is the largest international economic organization in the world comprising of 164 member states.