Pace of Growth Declines Further for Japanese Trade

December 10, 2019 - 02:26
Pace of Growth Declines Further for Japanese Trade

  • Air exports in the automobile, machinery and chemicals industry to sustain growth despite overall trade heading towards deflation
  • Bullish ocean import outlook of Basic Raw Materials set to make significant contribution to trade growth

TOKYO, JAPAN - Media OutReach - December 10, 2019 - Air exports within the automobile, machinery and chemicals industry will offer some upside to trade growth in Japan for the three-month period ending in January 2020, even as the country's growth falls into negative territory, according to data from the DHL Global Trade Barometer released by DHL, the world's leading logistics company.

The DHL Global Trade Barometer, an early indicator of global trade developments calculated using Artificial Intelligence and Big Data, predicts that Japan's trade levels will contract in near term, with the country's index value decreasing by five points to 48 points -- below the no-growth threshold of 50 points on the Index.[1] The negative growth stems primarily from shrinking air trade across industries, though certain core sectors like automobile manufacturing are expected to remain relatively strong and offset the significant decline in other export areas.[2]

"Despite a contraction in the forecast for the next three months, Japan's trade outlook remains relatively robust thanks to the strong base provided by core industries such as automotive manufacturing, machinery and technology," said Charles Kaufmann, CEO North Asia South Pacific, DHL Global Forwarding. "Exports for Land Vehicles & Parts look set to make notable contributions to trade growth off the back of industry consolidation and greater investment in electric and self-driving vehicles. We also see the upcoming Tokyo 2020 Olympic Games contributing to the bullish outlook for imports of Basic Raw Materials over the next quarter, with the Games expected to have positive impacts on the Japanese economy across the board."

Steady but mild decline negatively affects all countries, except India

The Barometer's results also suggest that world trade is expected to continue at moderate pace but further contract for the next three months, driven by minor decreases in both air and containerized ocean trade. Against previous quarters this year, the downward trend in trade growth remains mostly stable, neither indicating an acceleration of the decline nor a bottoming out of contractionary movement. All seven nations monitored by the Barometer received indexes below 50 points except for India, where the Barometer forecasts moderate growth of five points to 54 points for India. While Japan and the UK had been the only countries with positive trade outlooks in the previous update in September, the two countries record the highest losses in this period.

"According to the DHL Global Trade Barometer the year will probably end with moderate world trade. However, we've to bear in mind where we come from: The rapid growth world trade has undergone in recent years was like climbing the Mount Everest. Now, we are on the descent, but we are still breathing altitude air", Tim Scharwath, CEO of DHL Global Forwarding, Freight, says. "A countless number of stable trade relations continues to flourish worldwide, despite smouldering trade conflicts and geopolitical uncertainties."

[1] In the Global Trade Barometer methodology, an index value above 50 indicates positive growth, while values below 50 indicate contraction.

[2] Click here for more information on the outlook for air freight and ocean freight or the key sectors in Japan.


Note to editors:

The proposed Regional Comprehensive Economic Partnership (RCEP) will boost market access to products and capital, and create the world's largest regional trading bloc that will account for more than 29.1 percent of global trade. Read more about Asia's next trade pact and its impact on global trade.

About the Global Trade Barometer

Launched in January 2018, the DHL GlobalTrade Barometer is an innovative and unique early indicator for the currentstate and future development of global trade. It is based on large amounts oflogistics data that are evaluated with the help of artificial intelligence. Theindicator is published four times a year and the next release date is scheduledfor end of March 2020.

For more information on the DHL GlobalTrade Barometer, please visit: index is now also available for subscribers of the Bloomberg terminalby using the code "DHLG <GO>".

DHL -- The logistics company for the world

DHL is the leading global brand in thelogistics industry. Our DHL family of divisions offer an unrivalled portfolioof logistics services ranging from national and international parcel delivery,e-commerce shipping and fulfillment solutions, international express, road, airand ocean transport to industrial supply chain management. With about 380,000employees in more than 220 countries and territories worldwide, DHL connectspeople and businesses securely and reliably, enabling global trade flows. Withspecialized solutions for growth markets and industries including technology,life sciences and healthcare, energy, automotive and retail, a provencommitment to corporate responsibility and an unrivalled presence in developingmarkets, DHL is decisively positioned as "The logistics company for the world".

DHL ispart of Deutsche Post DHL Group. The Group generated revenues of more than 61billion euros in 2018.