Trade Slows
Around World
Declining
Growth in Exports Dims Prospects for U.S. Economy; Europe Cuts Imports
The article
that I chose this week discussed the recent decline in international trade and
the possible effects that it could have to the US economy. After the recession 2009 trade has been a
spark within the American economy. Over this
period of time, exports have accounted for over half of the economic growth. The WTO has projected that global trade will
only expand by 2.5% this year. That is
down from 5% in 2011 and 14% in
2010. The root of the problem seems to
be centered around Europe. The European
Union has previously been China’s largest export market. Chinese exports to Europe have recently
dropped by nearly 5%. This decline has
been detrimental to the Chinese manufacturing market and their economy as a
whole. There is a small amount of fear
residing in economists because a decline in trade was the primary reason for the
2009 recession. But unlike 2009 there
are still several strengths among the global trading market. One of the current strengths is Latin
America. Exports to Latin America have
grown, absorbing some of losses brought by Europe. Chinese exports to the United States are also
up by 10%. The US could be the largest
export market for China for the first time since 2006. Currently China is one of the largest
economies in the world. A decline in
their economy could be very harmful to the global economy. Europe’s recession is beginning to impact the
global economy. It is important for
global economists to not let this issue snowball. If global trade continues to
decline, we may witness a serious recession among the global economy.
2/1/2013 4:07 PM
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