World trade in goods is set to slow more sharply than previously expected next year, possibly easing inflationary pressures but raising the risk of a global recession, a new forecast shows.
With the surge in energy costs and rising interest rates weakening household demand, exports and imports should increase by just 1% in 2023, down from a previous forecast of 3.4%, the World Trade Organization said Wednesday.
A slowdown in trade flows driven by weakening demand could help bring down price pressures by unblocking supply chains and reducing transport costs. It also means there is an increased risk that the global economy will contract.
With the continued gradual improvement in schedule reliability in August 2022 and the resultant improvement in vessel delays, the global fleet that was unavailable due to these delays dropped to 7.9%, according to the latest report by Danish shipping data analysis company, Sea-Intelligence, while the peak of 13.8% was in January 2022.
"Keeping in mind the baseline unavailable capacity of 2% (as there are always some delays), at the height of delays in January 2022, an additional 11.8% of capacity was being absorbed," said Sea-Intelligence's analysts.
Indian exporters – now relieved to see some moderation in sky-high freight rate levels amid slowing volumes – have a new cost burden to deal with: a government tax levy.
The setback follows the end of previously-granted federal exemptions from the applicability of Goods and Service Tax (GST) on export freight.
South Africa's United National Transport Union (UNTU) has served a 48-hour notice on the country's major terminal operator Transnet, indicating the union's intention to embark on strike action from 6 October at 00:01 am (local time).
UNTU claims that Transnet has delayed salary negotiations for months and has still not made a "reasonable offer" to its employees.
United Airlines Holdings Inc. plans to suspend service at New York’s John F. Kennedy International Airport, following through on a threat earlier this month to halt flights if regulators don’t allow the carrier to expand there.
The decision, effective Oct. 29, will only affect four daily flights. The carrier’s New York-area presence is largely concentrated at nearby Newark Liberty International Airport in New Jersey, as well as New York’s LaGuardia Airport. The 100 United employees based at JFK will be transferred to nearby stations and there will be no job losses, according to an internal message Friday seen by Bloomberg.
The Biden administration plans to announce new restrictions on China’s access to U.S. semiconductor technology, according to people with knowledge of the situation, an escalation of Washington’s efforts to stifle Beijing’s industrial ambitions and a risk to growth for the $550 billion sector.
The Commerce Department will roll out a package of rules this week to govern which semiconductor technologies can be exported to China, including codifying earlier guidance given to specific companies, said the people, who asked not to be identified as the information isn’t public.
The European Union has agreed to impose emergency measures to charge energy firms on their record profits. According to BBC News, ministers have agreed windfall taxes on certain energy companies, as well as mandatory cuts in electricity use.
The plan includes a levy on fossil fuel firms' surplus profits and a levy on excess revenues made from surging electricity costs. The cash raised is expected to go to families and businesses.
Each piece of the supply chain — manufacturing, transportation and consumption — depends on one thing: people.
The imbalance of the supply chain now is based on human error — the over-ordering of products and selling those that people didn’t want — and port congestion — caused by fears of an International Longshore and Warehouse Union (ILWU) strike, which has diverted trade and created bottlenecks. We know trade is slowing down, but the congestion skews the reality of the pullback in orders.
Trade data is actionable. It provides insight into retail expectations. We know orders have been down, and as a result, we have seen freight rates fall and blank sailings increase.