Trade Slump Hits Poorest Countries
The slump in world trade this year in the wake of the financial crisis has hit the export earnings of the poorest countries, particularly hard, as prices tumble and volumes stagnate, a study released on Tuesday showed.
The world's 49 least developed countries (LDCs) saw export earnings in the first six months of this year fall by 43.8 per cent from a year earlier before the crisis, the International Trade Centre said.
For the world as a whole the decline was 32.4 per cent. 'These figures dramatically highlight the devastating impact of the continuing economic crisis on the economies of the poorest developing countries and the well-being of their people,' ITC Executive Director, Patricia Francis, said in a statement.
For landlocked developing countries the decline was 49.7 per cent, and for sub-Saharan Africa, an overlapping category, it was 48.6 per cent.
'There has been a sharp decline in the value of developing country exports during the first half of 2009...,' said the ITC, a joint agency of the World Trade Organisation and the United Nations that promotes export-led growth in developing nations.
'Second, while the decline in trade values is significant, it has not been accompanied by a commensurate decline in trade volumes,' it said in the study.
ITC Lead Economist, Willem van der Geest, said that data so far this year did not point to any recovery.
But the study showed a varied picture depending on the export structure of individual countries.
For instance, excluding exports of energy products such as coal, oil and gas, export earnings for LDCs fell only by 13.5 per cent against a worldwide drop of 28.9 per cent.
In the textile and garment sector, the value of LDC shipments actually edged up by 0.5 per cent, with Bangladesh seeing the value of its textile export to rich countries rising by seven per cent, while Cambodia's dropped by 15.7 per cent.
'It shows the importance of export diversification both by market and by product,' said Van der Geest, noting that 80 per cent of Cambodia's exports go to the United States, while 80 per cent of Bangladesh's exports go to 11 partners, including the United States and European Union.
— Reuters