A brake on world trade is coming.
It is anticipated by the World Trade Organization (WTO).
It foresees a slowdown in world trade for the end of this year 2022 and the beginning of next year 2023.
There are basically three factors that the WTO identifies as the origin of the cooling of international trade: the war in Ukraine, the high prices of energy and the currency exchange rate.
It is not a discursive statement. These are specific data provided by the Merchandise Trade Barometer.
It is a composite leading indicator of world trade that provides real-time information on the path of merchandise trade relative to recent trends.
This indicator, when it marks above 100, anticipates an expansion. When it is below that reference level, it reflects the cooling of the demand for tradable goods. The indicator is at 96.2 points.
The marker coincides with the forecast of the WTO itself, which projects a growth of 3.5% in the volume of trade in goods for the end of this year and 1% for the next year 2023.
The diagnosis is worrisome because it reflects cooling business confidence and weaker global import demand.
It is an additional problem to that of the world economy, plagued by the inflationary phenomenon and changes in the monetary and fiscal policy of central banks and governments.
Plus the one that is taking place in China with the unusual protests that were registered by the Zero Covid policy that has been implemented and, intends to reinforce, the government of that country.
These protests sent oil prices tumbling yesterday and are likely to lead to a production shortfall of about 6 million iPhone Pro units this year if workers do not return to Apple’s key manufacturing center in Zhengzhou. Yesterday for now, Apple’s shares fell 1.9%.
It would be another hit to the tech supply chain.
That is in the international context.
At the local level, figures were released indicating that the main growth engine of the national economy is beginning to lose dynamism.
Inegi reported that in the month of October the monthly variation, with seasonally adjusted figures, foreign sales fell 4.17%, in what was its biggest drop since January of this year.
Oil exports slowed to 6.94%, below the 30.81% of the previous month, and this was also their least dynamism since January 2021. Non-oil exports grew 18.5%, less than the 25% in September.
And the manufacturing slowed down from 26.4% in September to 19.84% in October, and those of the automotive industry went from 41.14 to 33.76%.
The figures reflect the beginning of the economic slowdown in the US, and global uncertainty and its impact on Mexico.
If Mexican exports decline, the most pessimistic economic growth forecasts for the Mexican economy are more likely to come true in 2023.
President Andrés Manuel López Obrador, in his speech last Sunday, made a very optimistic forecast for Mexico’s economic growth.
He said that the Gross Domestic Product will register a growth rate by the end of 2022 and the following 2023 and 2024 of 3.5%. It is not the first time that he has made forecasts that are too far from reality. In fact, he has failed in all his forecasts. It has failed on its own promises of economic growth.
It must be remembered that as a candidate for the Presidency of the Republic he came to affirm that the Mexican economy would grow at 4% per year during his government. The reality has been very cruel. In 2020, the Mexican economy fell 8.38% in real terms and grew at an annual rate of 5% in 2021.
The Gross Domestic Product of Mexico is still 3.61% lower than in 2019, before the arrival of COVID.
In addition to external risks to growth. There are internal risks.
Those that have to do with the uncertainty caused by government policies on energy, yellow corn, biotechnology and fertilizers.
If it is not resolved favorably, the economic outlook for Mexico will be much more difficult, given the worrisome international context.
glimpses
Finally, Canaero positioned itself against cabotage and the fifth freedoms that the Mexican government has been analyzing to promote the AIFA operation. The airline union spoke out against it and warns that it would harm their operations.
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