April 17, 2006: During year 2000 to 2005, the international trade witnessed increase of more than 60%, growing from US$ 7.8 trillion to US$ 12.6 trillion, an increase of more than US$ 4.7 trillion. China and European Union contributed most to this increase. This increase translates to annual compounded increase of 9% on YOY basis.
China did contribute a massive sum to this increase in trade. Virtually in many sectors as toys or electronics, the manufacturing worldwide has shifted to China. Its impressive performance has been well recognized by world media as well. Chinese exports contributed US$550 billion to this increase. This is primarily for the reason that in most places of the world, even basic raw material would cost higher than cost of finished product in China.
However, this increase is less than 12% of the total increase in international trade globally. That means, some other countries are also getting aggressive in cost cutting and waking up to growing challenge from this east Asian Country, which was no where on global export map about a decade ago.
Surprising, despite the steep rise in Oil Prices, a major commodity contributing to exports from Middle East, the exports of Middle East just doubled from US$283 billion to $594 billion contributing only about slightly more than 6% of the total increase over the said 6 year period.
Increase by Latin American and the Caribbean countries was modest; about US$ 192 billion amounting to about 4% of the total increase.
Despite the hype and hoopla concerning the trade from China, the large part of the increase was contributed by developed and industrialized nations only. This proves the fact once again that per capita purchasing power of a country plays a dominant role in its exports. EU contributed around 45% of the total increase of US4.7 trillion, registering an increase of about US$2 trillion over the said period. This huge increase was attributed to strengthening of the currency as well as increase in volume of exports.
United States surprising emerged as a laggard. This is also one of the reasons, why its currency has taken beating against all major currencies. Its exports grew only by $ 220 billion accounting for increase of less than 5% of global increase. Former Global Champion of the world, Japan, which ruled the exports market, also tumbled registering about 3% of the increase.