An alarming slowdown in global trade shows Trump's tariff war is having a devastating impact
- Data from Swiss freight giant Kuehne + Nagel shows global trade grew 0.3% in November. In the same month last year, it grew 3.1%.
- The The impact of President Donald Trump's trade war is clear to see: Every single region of the globe saw its foreign trade growth drop in November.
- Kuehne + Nagel's data matches what Maersk, the world's largest shipping company, said earlier this month, when it published data showing a slowdown in global container trade growth.
The negative impact of the ongoing trade battle between the US and China is plain to see in new data from Swiss freight giant Kuehne + Nagel.
According to the data, published on Tuesday, global trade was up 0.3% in November compared to the previous month. It's a massive shift from November 2017, when world trade grew 3.1% month-over-month.
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The picture is a bit nuanced. For example, trade overall is up 6.4% from the same point last year, pushing Kuehne + Nagel's World Trade Indicator to 143.7, the highest level since records began. But it's still clear the US-China trade war is having an impact. Going forward, the data shows a consistent downward trend. The chart below illustrates this trajectory over the past 12 months:
Not only is overall global trade growth slowing, but in many areas, it is actively shrinking.
"In ocean freight, measured by the live throughput of ports, the unit volume declined slightly in November," down 0.3% month over month, Kuehne + Nagel said in the release.
On top of that, every single region of the globe saw its foreign trade growth drop in November.
Kuehne + Nagel's data matches what Maersk, the world's largest shipping company, said in November, when it published data showing a slowdown in global container trade growth.
Global container trade continued to lose momentum in the third quarter. And so far this year, it has suffered "a much slower pace of growth," rising by 4.2% compared with the 5.8% recorded over the same period in 2017, Maersk said.
Slowing global trade comes against a backdrop in which the US has introduced tariffs of 10% on $250 billion worth of Chinese goods entering the US, prompting Chinese policymakers to retaliate, albeit on a smaller scale.
President Trump has also repeatedly threatened to place tariffs on all US imports from China, an amount totaling more than $500 billion annually.
Relations have thawed a little in the last few days after Trump and his Chinese counterpart, Xi Jinping, came to a tentative truce on trade at the G20 summit in Buenos Aires, Argentina, postponing an increase in tariffs and agreeing to a 90-day window for further discussions.
The US agreed not to raise the 10% tariff rate on $200 billion worth of Chinese goods to 25% on January 1, as originally scheduled, while in return China committed to buying a "very substantial amount" of agricultural, energy, and industrial goods from the US.
The agreement, however, is seen by most commentators as merely a temporary fix, with many expecting a further escalation once the three month truce comes to an end.