DUBAI, UAE, June 9, 2021 /PRNewswire/ -- Global trade
will rebound in 2021 after showing surprising resilience in 2020
despite the economic challenges posed by the pandemic, according to
DMCC's latest special edition Future of Trade 2021 report
titled, "Defying predictions and driving the post-pandemic economic
recovery."
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The report released today highlights that global trade will
underpin strong global economic growth in 2021 and beyond, with the
US and Chinese economies leading the way. This growth has defied
expectations of double-digit annual declines, which had been
estimated between 13-32% by the World Trade Organisation. For
example, Dubai, a major trade hub,
saw its foreign trade growth rebound significantly in 2020, despite
the economic challenges posed by the COVID-19 pandemic, with the
second half of 2020 seeing a particularly strong jump in trade
volumes, of 6% year-on-year. Dubai's overall export values jumped 8% in
2020, on an annual basis.
Ahmed Bin Sulayem, Executive
Chairman and Chief Executive Officer, DMCC, said: "In 2020, the
outlook for global trade was bleak as the world sought to grapple
with the impact of the pandemic. Today, the picture is much more
positive, as evidenced by the findings of our latest Special
Edition Future of Trade – 2021 report. But while global trade
has shown its resilience, it is simultaneously in the midst of
profound change. Technology, changing consumer behaviours, the
drive to combat climate change, and geopolitics will all be key
contributors to its reshaping in the years ahead. In this context,
our research puts forward a number of tangible recommendations to
governments and businesses seeking to navigate this new landscape
and accelerate the recovery from the pandemic."
According to the research, the most transformative element of
the global trade outlook is technology. Blockchain, decentralised
finance (DeFi) and other new and disruptive technologies will
further accelerate trade growth. For example, DeFi protocols have
seen a considerable amount of funds invested. Since the start of
2021 alone, the total value locked into DeFi has tripled from
approximately USD 20bn to
USD 60bn. As digital infrastructures
grow, they will continue to accelerate a ground-breaking shift in
trade from the national to the global.
On the geopolitical front, fears of protectionist policies
persist and are propelled by ongoing US-China trade tensions,
rising economic nationalism, and the widening economic
disparity between lower and middle-income economies. Alongside
this, in a significant development for sustainability and global
trade, the EU's drive to harness a carbon pricing practice, under
the anticipated Carbon Border Adjustment Mechanism (CBAM), or
"Carbon Pricing," has been criticised as a form of protectionism,
and as such, has the potential to further exacerbate existing
geopolitical tensions. The findings suggest that while a "new
age of protectionism" is a key risk in the wake of the pandemic and
increasing discussions around US-China decoupling, outright
protectionism will be kept at bay because it is costly,
unpredictable, and impacts jobs. Instead, economic nationalism is
more likely to occur.
While there were fears that the pandemic would see
sustainability drop down the political and corporate agenda, that
has not been the case. Rather, China, Japan,
the US, South Korea and
Canada are among nations to have
announced more aggressive net zero targets. Further, companies
and investors have ramped up their sustainability efforts and they
are set to grow exponentially in the years ahead. For its part,
CBAM has the potential to significantly disrupt international trade
and raises questions around how to accurately measure emissions
from complex supply chains. Once again, technology and artificial
intelligence may provide at least part of the answer for companies
and governments seeking to make accurate assessments relating to
sustainability within their trade agendas.
During the launch event, global trade experts joined a panel
discussion to share their views on the report. Panellists included
Khatija Haque, Head of Research
& Chief Economist, Emirates NBD; Roberta Piermartini, Chief of
Trade Cost Analysis, World Trade Organisation; Yanislav Malahov,
crypto and blockchain technology expert and Founder of Aeternity;
and Marcus Treacher, Chief Executive
Officer of CB Investment Growth Holdings and Board Member of Clear
Bank and RTGS Global.
To read the full report by DMCC, please visit:
www.futureoftrade.com.
About DMCC
Headquartered in Dubai, DMCC is
the world's most interconnected Free Zone, and the leading trade
and enterprise hub for commodities. Whether developing vibrant
neighbourhoods with world-class property like Jumeirah Lakes Towers
and the much-anticipated Uptown Dubai, or delivering high
performance business services, DMCC provides everything its dynamic
community needs to live, work and thrive. Made for Trade, DMCC is
proud to sustain and grow Dubai's
position as the place to be for global trade today and long into
the future. www.dmcc.ae
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