Imports will grow faster than exports in emerging markets within the next five years, HSBC Commercial Banking’s latest global connections report predicts. Traditionally, export-driven countries are starting to see imports rise, driving developed and emerging market growth.
In the Asia Pacific, 10 of the top 15 global trading partners are countries from within the region
The Global Connections Trade Forecast reflects this sentiment: in China, India and Brazil, the rate of growth in imports will exceed that of exports over the next five years, continuing to 2026.
The US, UK, France and Spain are expected to see export growth exceed the rate of imports over the 15-year period. Germany and China, meanwhile, are set to leapfrog the US to become the world’s largest importers by 2026, while India is predicted to progress from 15th to 10th place by 2026. Some of the fastest growing importers to 2016 are expected to be Brazil, India, and Indonesia.
The report also suggests businesses’ short-term outlook for the global economy is positive, especially in the emerging markets. According to HSBC’s Trade Confidence Index, 71 per cent of respondents believe the global economy will remain stable or grow in the next six months, mainly driven by confidence in emerging markets. Only one country from the traditional ‘developed markets’ appears in the top 10 most confident countries.
In the Asia Pacific, 10 of the top 15 global trading partners are countries from within the region. This trend is expected to strengthen. Nine of China’s 15 largest import partners and six of its fastest growing partners to 2016 come from the same region. The top six fastest growing export destinations for India to 2016 are either in Asia or the Middle East.
Latin America is looking outside of its own borders and turning towards Asia for its trading needs, with nine out of the top 15 trading partners falling from outside of the region.
Latin America’s top five fastest growing import partners to 2016 are India, China, Thailand, Indonesia and Singapore. Six of the top 10 fastest growing export destinations for Brazil to 2016 are either Asian or Middle Eastern countries.
“Despite the index showing broad optimism about what the next six months hold, businesses cannot afford to be spectators.
“International businesses in developed nations have to look beyond their borders at the opportunities in rapidly growing markets, while emerging market businesses need to access the growth of these new trade powerhouses closer to home,” HSBC Group managing director and global head commercial banking Alan Keir stressed.
Michel Cordina, head of commercial banking at HSBC Bank Malta, said the report’s findings augured well for the Malta bank’s vision to increase the island’s connectivity with such markets by leveraging the strength of the group in these territories and offering Maltese businesses new opportunities to grow.
Information and country reports are available at http://globalconnections.hsbc.com/news-insights/emerging-market-import-growth-drives-rebalancing .