There are tentative signs of a bounce back in global trade, according to the CEO of shipping titan Maersk.
“Barring any negative surprises, we would hope for a slow pickup as we get into 2024, a pickup that will not be a boom like what we have known in the past few years, but certainly ... a demand that is a bit more in line with with what we see in terms of consumption, and not so much an inventory correction,” Vincent Clerc told CNBC’s Silvia Amaro this week.
Consumers in the U.S. and Europe have been key drivers in this demand uptick, Clerc said, and those markets have continued to “surprise on the upside.”
In 2022, the shipping firm warned of weak demand as warehouses filled up with unwanted goods, with consumer confidence stuttering and supply chains congested.
The upcoming pickup would be fueled by consumption, he said, rather than the “inventory correction” which has featured heavily during 2023.
Emerging markets are proving resilient, despite the difficult economic climate, Clerc said, particularly in the cases of India, Latin America and Africa.
North America is also looking strong for the next year, despite having faltered along with many other major economies due to macroeconomic factors, including Russia’s full-scale invasion of Ukraine and tensions with China.
“As this starts to normalize and works itself out, we will see a rebound in demand,” Clerc said.
“I would say emerging markets and North America are certainly the points where we see the most upside potential,” he added.
But the road to bolstering global trade and growth isn’t necessarily a smooth one, as highlighted by IMF Managing Director Kristalina Georgieva in a recent interview with CNBC.
“What we see today is very troubling,” Georgieva told CNBC’s Martin Soong on Sept. 10 on the sidelines of the Group of 20 nations leaders’ summit in New Delhi.
“There is fragmentation in our world. For the first time global trade grows slower than the global economy, 2% trade, 3% global growth. If we want trade to become, again, an engine of growth, then we have to create corridors and opportunities,” she said, referencing a planned rail-to-sea economic corridor linking India with Middle Eastern and European countries.
© OfficialAffairs
