Summary
This World Trade Overview is provided by the Whitehouse & Associates, leaders in African market research and risk assessment.
According to the latest World Trade Organisation (WTO) annual report, total world trade during 1999 amounted to US$ 11485.0 billion with exports totalling US$ 5610.0 billion and imports totalling US$ 5875.0 billion. The United States, the European Union and Japan are the key players in world trade accounting for 45% of world exports and 49% of world imports. Developing countries accounted for 27.5% of merchandise exports in 1999.
Leading exporters and importers in world merchandise trade (excluding intra-EU trade)
| Rank | Exporters | Value (bn dollars) | %age of world trade | Importers | Value (bn dollars) | %age of world trade |
| 1 | European Union | 798.6 | 18.9% | United States | 1059.9 | 23.6% |
| 2 | United States | 695.0 | 16.4% | European Union | 851.2 | 18.9% |
| 3 | Japan | 419.4 | 9.9% | Japan | 310.7 | 6.9% |
| 4 | Canada | 238.4 | 5.6% | Canada | 220.2 | 4.9% |
| 5 | China | 194.9 | 4.6% | Hong Kong | 181.7 | 4.0% |
| 6 | Hong Kong | 174.8 | 4.1% | China | 165.7 | 3.7% |
| 7 | Korea, Republic of | 144.2 | 3.4% | Mexico | 148.2 | 3.3% |
| 8 | Mexico | 136.7 | 3.2% | Korea, Republic of | 119.7 | 2.7% |
| 9 | Taiwan, Province of China | 121.6 | 2.9% | Taiwan, Province of China | 111.0 | 2.5% |
| 10 | Singapore | 114.6 | 2.7% | Singapore | 111.0 | 2.5% |
| Total* | 4232.0 | Total* | 4494.0 |
The process of globalisation in the world economy is increasing the dependence of countries on foreign trade and making the requirement for a rule-based system to monitor this trade increasingly important. Countries need to know that they will be assured access to international markets and that the terms and conditions of this trade will not be suddenly changed at the whim of governments.
World Trade Organisation (WTO)
The World Trade Organisation (WTO), the global organisation dealing with the rules of trade between countries, is providing this multilateral rules-based system. Click here for more information on the WTO. (orgs/cdt1)
This system is underpinned by a set of WTO agreements that have been negotiated and signed by the majority of the world’s trading nations and ratified by their parliaments. The current set of WTO agreements were negotiated between members at the Uruguay Round of negotiations (1986-94). Effectively, these agreements form the legal framework in which international trade occurs. They guarantee member countries trade rights and bind member governments to keep their trade policies within agreed limits. The agreements have three principal objectives:
To assist in free flows of trade
To achieve further gradual trade liberalisation through negotiation
To set up an impartial means of dispute settlement
The WTO system consists of three principal substantive agreements. They are:
Multilateral Agreements on Trade in Goods including the General Agreement of Tariffs and Trade and its associate agreements
General Agreement on Trade in Services (GATS)
Agreements of Trade-Related Aspects of Intellectual Property Rights (TRIPS)
The Multilateral Agreements include a number of instruments including the Agreement on Preshipment Inspection, the Agreement of Technical Barriers to Trade, the Agreement on Import Licensing Procedures, the Agreement of Textiles and Clothing, the Agreement on Agriculture and the Agreement on Rules of Origin.
The Seattle Round
The Seattle Round of multilateral negotiations was launched in November 1999. The objective of the Seattle meeting was to set the WTO’s agenda for the next five-year period. Following protest marches through the streets of Seattle and arguments between developed and developing countries over how to proceed with the formulation of a new international trade dispensation without further marginalising developing countries, the talks were suspended.
The WTO Director General, Mike Moore issued a statement after the failed talks to the effect that despite the temporary setback in Seattle, WTO objectives remain unchanged:
To continue to negotiate the progressive liberalization of international trade.
To put trade to work more effectively for economic development and poverty alleviation.
To confirm the central role that the rules-based trading system plays for Member governments in managing their economic affairs cooperatively.
To organize the WTO on lines that more truly represent the needs of all Members
The WTO is not able to give a date for resumption of talks. In January 2000 the EU Trade Commissioner, Pascal Lamy, announced plans to launch a new round of world trade talks before the end of the year. The South African Minister of Trade and Industry, Mr Alec Erwin has, along with other developing countries, recently launched an initiative aimed at restarting the Seattle round reiterating the commitment of developing countries to a rules-based international trading system.
Trading Blocs
During the past decade, world trade has been characterised by the move towards the creation and strengthening of regional trade blocs and agreements. Trade blocs are groups of countries that have established special preferential trading conditions amongst member states. Although the preference given to fellow member states are often greater than those given to non-member states, the ultimate purpose of trading blocs is to encourage trade between member states.
Total exports by trade blocs expressed as a percentage of world exports
| Bloc | %age of world exports | |
| 1990 | 1998 | |
| Asia-Pacific Economic Cooperation (APEC) | 38.9 | 45.3 |
| European Union (EU) | 44.1 | 35.5 |
| North American Free Trade Agreement (NAFTA) | 16.2 | 18.4 |
| Latin America and the Caribbean | ||
| Andean Group | 0.9 | 0.8 |
| Central American Common Market (CACM) | 0.1 | 0.3 |
| Caribbean Community (CARICOM) | 0.2 | 0.1 |
| Latin American Integration Association (LAIA) | 3.4 | 4.7 |
| Southern Common Market (MERCOSUR) | 1.4 | 1.5 |
| Organisation of Eastern Caribbean States (OECS) | 0.0 | 0.0 |
| Africa | ||
| Economic and Monetary Community of Central Africa (CEMAC)/ Customs and Economic Union of Central Africa (UDEAC) | 0.2 | 0.1 |
| Economic Community of the Great Lakes Countries (CEPGL) | 0.0 | 0.0 |
| Common Market for Eastern and Southern Africa (COMESA) | 0.4 | 0.4 |
| Economic Community of Central African States (ECCAS) | 0.3 | 0.2 |
| East African Community | – | – |
| Economic Community of West African States (ECOWAS) | 0.6 | 0.4 |
| Mano River Union (MRU) | 0.1 | 0.0 |
| Southern African Development Community (SADC) | 1.0 | 0.8 |
| West African Economic and Monetary Union (UEMOA) | 0.1 | 0.1 |
| Middle East and Asia | ||
| Association of South-East Asian Nations (ASEAN) | 4.3 | 6.1 |
| Bangkok Agreement | 3.5 | 4.8 |
| Economic Cooperation Organisation (ECO) | 1.1 | 1.1 |
| Gulf Cooperation Council (GCC) | 2.6 | 1.7 |
| South Asian Association for Regional Cooperation (SAARC) | 0.8 | 1.0 |
| Arab Maghreb Union (UMA) | 1.0 | 0.5 |
