Asia set to drive global trade surge: HSBC
Asia is poised to ignite a decade of global trade growth and will be the starting point for a quadrupling of worldwide exports to an estimated $68.5 trillion by 2050, according to a forecast by HSBC.
Led by a burst of intra-Asian trade that will lift the region's share of global exports to 27 percent by 2050 from 17 percent at present, the surge will mark a third wave of globalisation anchored by new technologies and increasing economic integration, the bank said in its Trade Winds report.
“The importance of trade's contribution to global growth and prosperity cannot be underestimated. Asia's position at the leading edge of technological and supply chain innovation gives the region a unique opportunity to benefit from this next wave of globalisation,” said Paul Skelton, regional head of commercial banking for Asia Pacific at HSBC.
Nimble networks of micro-multinationals that create their own specialised value chains will be at the core of a drive for prosperity that promises to take nations out of poverty and improve quality of life across the world, said the report compiled by Oxford Economics.
“The next few years should carry the global economy into the next wave of globalisation, critically underpinned by sophisticated and pervasive digital technology that reduces international trade barriers, improves communication between cultures, levels the playing field for entrepreneurs and startups, and forms the foundation for an 'always-on' global economy.”
The report looks back in time to uncover the key drivers of trade over the past 150 years, analyses the impact of these drivers and forecasts how they will shift the world in the future.
The report identifies three distinct waves of trade development: the first from 1865 to 1913, the second from 1950 to 2007 and the third set to run from 2015 to 2050.
“The map of world trade created by this third wave of globalisation may look very different from today's, as shifting demographics and economic catch up -- with almost three billion people joining the middle class by 2050, most of whom will be in emerging markets -- lead to significant shifts in trade patterns.”
It said Asia-Pacific's share of global exports is forecast to rise from around a third in 2015 to 46 percent in 2050. Western Europe's share is expected to decline from 34 percent to 22 percent, and North America's to fall from 11 percent to 9 percent.
The HSBC report also said China should extend its lead as the world's leading exporter, with its growing influence in Asia further extended by projects such as the 'One Belt, One Road' initiative and the Asian Infrastructure Investment Bank.
India also has the potential for strong growth, and is projected to outpace China. The report expects growth in merchandise exports from India to average 6 percent a year in 2025–50, compared with just under 5 percent a year for China.
The report identifies four 'trade winds' that will drive opportunity for the business leaders of today and tomorrow -- the march of industrialisation and a shift to mass customisation; plummeting transport and logistics costs; further liberalisation of trade policy; and the evolution of more nimble business operating models.