The global economy has once again surprised pessimists by its tremendous staying power, replacing past concerns that global growth might falter with inflationary worries, fuelled by high and rising oil prices. We see growth slowing marginally this year, compared to last, but if the almighty consumer does not lose heart we can expect a relatively good year.
Given the world economy's overdependence on American household spending however, the fact that the US personal savings rate remains in negative territory makes one wonder how long the current business cycle will maintain its remarkable performance before running out of steam.
The case for medium-term pessimism is mainly based on the huge macroeconomic imbalances in the global economy which are getting larger and more dangerous with every passing month.
The fundamental problem remains a lack of dynamism outside North America and Asia, especially in the Eurozone and Japan, even if there are some signs of reawakening.
Indeed, with a 1.4% sustainable growth forecast for Japan and a 1.8% predicted growth rate trend for the Eurozone for the next few years, it seems that these economies won't be able to be significant contributors to future global growth.
Thus, considering the uncertainty of a possible slowing down of the US economy, the global economy's medium-term outlook will continue to remain under a cloud.
What does all this mean for trade and port throughputs you ask? The answer in short is for more good news and growth. For example, China now has surpassed Japan to become the world's third largest importer. In value terms, this year China could import about 6.8% of world exports.
In 2005, total world trade grew by some 3.8%, which is slower than the "record" growth in 2003 of 6.1%. Total tonnage this year will hit more than 9.2bn metric tons worldwide. Not bad for a 5th year of global economic growth.
