* This is my column in BusinessWorld last December 27.
Global merchandise trade has slowed down recently despite
low oil prices and less political and economic instability. After recovering
from the 2009-2010 global financial turmoil, merchandise exports reached $18.3
trillion in 2011, $19 trillion in 2014, declined to $16.5 trillion in 2015, and
fell further to $16 trillion in 2016.
The top 5 exporters in merchandise goods in 2015-2016
were China, USA, Germany, Japan, and Netherlands. Germany and Netherlands have
the advantage of easier trade because they both are located in one continental
land area and hence, can export by land, unlike China, US, and Japan which have
to export largely by water.
Eleven (11) Asian economies, five of them from the ASEAN,
belong to the top 30 biggest merchandise exporters in the world in 2015-2016.
The Philippines remained in ranks 45th-46th.
In commercial services, global exports have slightly
increased from $4.76 trillion in 2015 to $4.81 trillion in 2016. The top 5
exporters in were US, UK, Germany, France, and China. Such services include
revenues from tourism and remittances of nationals working abroad.
In particular, the Philippines’ merchandise exports have
recovered with higher growth this year. Cumulative figures for January-October
period are: $49.05 billion in 2015, $47.55 billion in 2016, and $53.11 billion
in 2017, or 11.7% growth in 2017 over the previous year.
Top 5 merchandise export markets of the Philippines last
year and this year are Japan, Hong Kong, US, China, and Singapore. The EU as a
bloc though is the Philippines 2nd biggest market — it imported $5.86 trillion
in 2016 and $7.83 trillion in 2017, January-October period.
Almost all export markets have increased their purchase
from the Philippines in 2017 except Japan and Singapore, but the export levels
to these two countries remain high.
Preliminary figures for 2017 point to a recovery and
higher levels in 2017 compared to 2016, Philippine figures provide the clue.
And not only in exports but also in imports.
The statement “If America (or Europe) turns
protectionist, Asia loses” is wrong. Whoever starts serious protectionism is
the loser. Free trade creates good will with other countries while expanding
the choices and options for local consumers and manufacturers, which expand
their productive capacity.
Asia will remain as a very important player in global
trade of goods and services, also in investments, for two important reasons.
One, growth momentum remains high, many economies growing 5% or more (GDP
growth) a year. Two, huge and generally young population especially in India,
Indonesia, Philippines, and Vietnam, comprising nearly 1.8 billion people with
an average age of only 24-25 years old which is one-half of the average age of
Japan and many developed countries in Europe.
Freer trade philosophy and policy will resurface in the
coming years. Trade is the biggest instrument to prevent wars among countries.
As the famous French economist and writer Frederic Bastiat once wrote, “If
goods cannot cross borders, soldiers will.”
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See also:
BWorld 172, Mining and natural disasters, December 30, 2017
BWorld 174, MMDA towed my car even with my kids inside, December 31, 2017
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