According to Reuters reported on December 11, the United Nations trade agency said on the 11th, compared with last year, this year's total global trade will shrink by 5%, and the overall forecast for next year is also more pessimistic.

　　The United Nations Conference on Trade and Development (UNCTAD) released "Global Trade Update", said that this year's total global trade is expected to reach about 30.7 trillion U.S. dollars. Among them, trade in goods is expected to decrease by nearly $2 trillion, or 8 percent, but trade in services is expected to increase by about $500 billion, or 7 percent.

　　According to UNCTAD, one of the reasons for the contraction in global trade is the poor performance of developing countries' exports.

　　Throughout 2023, global trade has been shrinking, with the main influencing factors including reduced demand from developed countries, the poor performance of East Asian economies and falling commodity prices," the report reads. Together, these factors have led to a significant contraction in trade in goods."

　　According to UNCTAD, projections for global trade in 2024 remain "highly uncertain and generally pessimistic."

　　The report writes: "While some economic indicators hint at an expected improvement, persistent geopolitical tensions, high debt levels and generally fragile economic conditions are expected to have a negative impact on global trade patterns."

　　Also according to a Dec. 11 report on the website of the French newspaper L'Echo, global geopolitical fragmentation is reflected in trade. Since the outbreak of the Russia-Ukraine conflict, trade between so-called "friendly" countries has been growing, while trade between geopolitically distant countries has suffered. That's according to a study released by UNCTAD on Monday.

　　Since the beginning of 2022, trade among "friendly" countries has grown by more than 6 percent, while global trade has shrunk by 4 to 6 percent. For example, between the fourth quarter of 2022 and the fourth quarter of 2023, U.S. trade with China decreased by about 2 percent, but U.S. trade with the European Union increased by 1.3 percent. During the same period, Russia's trade with China increased by 8%, while trade with the EU shrank by 6%.

　　Overall, supply chains have begun to reorganize because of the new geopolitical realities. This reorganization has various elements of conflict, but it is also related to the industrial policies that countries have adopted in response to climate change or to protect local businesses. The UNCTAD report explains that, whether it is tariff measures (raising tariffs) or non-tariff measures (introducing regulations on the origin of products), "there are more restrictions on trade in 2023".

　　This trend of returning to the home country poses a constraint on international trade, which is not very dynamic. The increase in trade between friendly countries has not helped, and the global trade volume has even contracted, due to weak global economic growth, falling demand in developed countries and the poor economic performance of Southeast Asian countries.

　　In October, the World Trade Organization had halved the growth of international trade in 2023, expecting it to grow by only 0.8 per cent. The United Nations Conference on Trade and Development (UNCTAD) is even more pessimistic, predicting that the volume of international trade for the whole of this year will be only 30.7 trillion dollars, which is a contraction of about 5 per cent compared with the record year of 2022.