SOUTHEAST Asia’s trade performance may improve by at least 3 percent this year as the region expands trade with big economies such as China, the chief economist of the World Trade Organization (WTO) said.
WTO Chief Economist Ralph Ossa and his team at the multilateral body estimated that the trade of the Asean region would grow by 3 percent this year both in terms of exports and imports.
Ossa explained that the trade performance of Asean countries “tend to be close but slightly higher” than the overall trade performance of Asia.
For example, the average annual growth of Asean exports since 2010 was at 4.4 percent, 0.4 percentage points higher than the 4 percent annual growth posted by Asia, according to Ossa’s virtual presentation.
It was also the same trend in terms of imports as Asean’s average import growth was at 4.7 percent during the same period compared to Asia’s 3.7-percent growth rate.
“If this tendency holds up, we should expect export and import volume growth of over 3 percent in 2023 [for Southeast Asia],” Ossa said in his virtual briefing with some Southeast Asian and Pacific journalists held in Bangkok, Thailand recently.
Ossa emphasized that recent Asean trends show the region’s declining rate of intra-regional trade in recent years. Part of the reason for the decline was attributed to Asean’s growing trade with China, Europe and North America, according to Ossa.
Ossa noted that the share of intra-Asean exports last year compared to the region’s overall exports dropped to 14 percent from 24 percent, while the share of intra-regional imports fell from 25 percent to 15 percent.
This was amid a growing value of Intra-Asean trade which was estimated at nearly $450 billion last year, 64 percent higher compared to 2016 figures, Ossa said. “Part of the reason for the decline is increased ASEAN trade with China, exports to which grew 98 percent in nominal dollar terms and imports from which rose 81 percent between 2016 and 2022,” he said.
“This growth came at the expense of trade with Europe, exports to which rose 39 percent and imports from which grew 31 percent. Meanwhile, growth in imports from North America was roughly in line with the ASEAN average (+60 percent) while growth in exports to North America was stronger than average (+90 percent),” he added.