Exports from Malta are forecast to grow by 80 per cent in the coming 15 years, according to HSBC head of trade and receivables in Europe Steve Box, with tremendous opportunities being generated in shipping and logistics for Malta to exploit.
The forecast is unchanged from three years ago, when HSBC had predicted annualised growth of 0.69 per cent to 2016, rising to 5.65 per cent between 2017 and 2021.
Mr Box was speaking at the presentation of the HSBC Global Trade Forecast, which found that exporters and importers in sectors such as transport equipment and metals would be the first beneficiaries as the pace of growth in cross-border commerce recovered to eight per cent in 2016, from just 2.5 per cent last year.
Looking ahead to 2020, the forecast – which looks at 25 economies – predicts that global merchandise trade would more than triple as companies capitalised on increasing productivity and consumer wealth in emerging markets. The importance of external trade for Malta was highlighted during the presentation by Economic Minister Chris Cardona who noted that over the next 20 years, 90 per cent of the world’s growth would come from outside the EU orders.
He noted that Malta has very little indigenous industry due to the small home market which does not give companies the chance to grow locally.
“Most companies are suppliers to larger mother companies or companies that assemble parts from other foreign suppliers,” he added.
Mr Cardona noted that confidence in Malta grew by 3.5 per cent compared to a drop of one per cent in the EU and the eurozone, according to the Economic Sentiment Indicator, with confidence improving in all sectors.
“We need strong, diversified and sustainable sectors. Maltese companies need more than ever to form part of global value chains,” he said.
Key forecasts:
• The value of traded goods will pick up from 2.5 per cent in 2013 to eight per cent in 2017-2020.
• By 2030, China will increase overseas shipments fivefold.
• India is likely to be the world’s fastest-growing exporter during the period 2014 to 2030, becoming the world’s fifth largest.
• Of the six countries expected to see fastest export growth, five are located in the Far East: Vietnam, China, India, Malaysia and Indonesia. The sixth country is Turkey.
• Nearly 42 per cent of respondents to the HSBC Trade Confidence Index (TCI) saw Asia as having the best opportunity for growth in the next six months.
• Fifty-five per cent of TCI respondents expect trade levels to rise either slightly or significantly over the next six months.
• The medium-term trade outlook is brightest for emerging market economies.