Pattern of Trade OCR Year 2 Macro

Pattern of Trade OCR Year 2 Macro

What is the Pattern of Trade? When we consider the pattern of trade we can focus on Geographical pattern of trade i.e. the countries with whom a nation trades Includes focusing on intra-regional trade i.e. depth and scale of trade between countries in the same region (EU, Africa, Asia) Scale of trade with regional trading blocs Commodity pattern of trade i.e. the types of products that are traded internationally Relative dependence on primary v manufactured v service sector exports Typically countries at an earlier stage of their economic development tend to export a narrower range of products – for example we often see primary product dependency

Pattern of Trade for Malawi – Exports of Goods Over 90% of Malawi’s exports of goods are agriculture or mining/extractive products. Only 8% of their exports are manufactured goods

Pattern of Trade for Malawi – Imports of Goods Malawi is dependent on final manufactured products and components for imports. The biggest single import is fertilizer. South Africa is the key source of imports.

Pattern of Trade for Malawi Breakdown in total exports (%) Breakdown in total imports (%) By main commodity group By main commodity group Agricultural products 80.4 Agricultural products 12.9 Fuels and mining products 11.4 Fuels and mining products 15.5 Manufactures 7.7 Manufactures 71.4 Geographical pattern of trade for Malawi By main destination (%) By main origin (%) 1. European Union 31.6 1. South Africa 21.7 2. Canada 11.6 2. European Union 14.1 3. South Africa 7.6 3. Mozambique 12.1 4. United States 6.4 4. China 9.3 5. China 5.6 5. India 7.8

Pattern of Trade for the UK: Exports of Goods The chart shows the main exports of goods from the UK (it does not show exports of services). Nearly 10% of our goods exports are cars and we also have a strong export performance in pharmaceuticals, aerospace and crude/refined petroleum – although North Sea oil and gas production is well past the peak and the UK is now a net oil/gas importer.

Pattern of Trade for the UK: Imports of Goods The UK has a high level of intra-industry trade, i.e. it tends to import similar products from those that it exports – for example vehicles, pharmaceutical products and manufactured products. We run a large (structural) trade deficit in goods, in other words, the UK is a net importer of manufactured goods, food and drink – although we export these as well. Overall the UK is a highly sophisticated economy with a strongly diversified pattern of trade.

Main Export Partners for the UK Economy (2014)

The UK’s Main Import Partners in 2014 In 2014, the United Kingdom's main import partner was Germany, accounting for 14.9 per cent of all imported goods and services.

Key Export Markets for UK Goods and Services   EXPORT SOURCES Country Value % of Total Cumulative £ million UK Exports Percentage (%) 1 United States 37 364 12.7 2 Germany 30 730 10.5 23.2 3 Netherlands 22 367 7.6 30.8 4 France 19 089 6.5 37.3 5 Irish Republic 18 145 6.2 43.5 6 China 15 511 5.3 48.8 7 Belgium & Luxembourg 12 317 4.2 53.0 8 Switzerland 10 318 3.5 56.5 9 Spain 9 299 3.2 59.7 10 Italy 8 808 3.0 62.7 11 India 6 353 2.2 64.9 12 Hong Kong 6 352 67.1 13 United Arab Emirates 6 055 2.1 69.2 14 South Korea 5 611 1.9 71.1 15 Sweden 5 355 1.8 72.9 16 Japan 4 270 1.5 74.4 17 Russia 4 137 1.4 75.8 18 Poland 3 898 1.3 77.1 19 Saudi Arabia 3 848 78.4 20 Norway 3 740 79.7 21 Australia 3 677 81.0 22 Turkey 3 599 1.2 82.2 23 Singapore 3 421 83.4 24 Canada 3 234 1.1 84.5 25 Denmark 2 963 1.0 85.5

Key Import Sources for the UK Economy   IMPORT SOURCES Country Value % of Total Cumulative £ million UK Imports Percentage (%) 1 Germany 60 820 14.6 2 China 36 900 8.9 23.5 3 Netherlands 33 160 8.0 31.5 4 United States 28 283 6.8 38.3 5 France 25 274 6.1 44.4 6 Belgium & Luxembourg 21 443 5.1 49.5 7 Norway 18 489 4.4 53.9 8 Italy 16 581 4.0 57.9 9 Spain 13 813 3.3 61.2 10 Irish Republic 11 911 2.9 64.1 11 Sweden 8 171 2.0 66.1 12 Switzerland 7 841 1.9 68.0 13 Poland 7 814 69.9 14 India 7 609 1.8 71.7 15 Hong Kong 7 461 73.5 16 Japan 7 277 1.7 75.2 17 Canada 7 236 76.9 18 Turkey 6 442 1.5 78.4 19 Russia 6 290 79.9 20 Czech Republic 4 759 1.1 81.0 21 Denmark 4 643 82.1 22 Taiwan 3 529 0.8 82.9 23 South Korea 3 207 83.7 24 Algeria 3 118 0.7 84.4 25 Singapore 3 099 85.1

Main Export Partners for China (2015)

Pattern of Trade for China – Exports of Goods In 2014 China exported $2.37 trillion, making it the largest exporter in the world Machinery accounts for the dominant part of Chinese exports of goods – the share of textiles in total goods exports is now declining as comparative advantage shifts to other countries.

Pattern of Trade for Bangladesh – Exports of Goods In 2014 Bangladesh exported $33.4B, making it the 61st largest exporter in the world Here is a great example of a country whose exports of goods are heavily dominated by low value-added manufacturing.

Biggest Exporters of Clothing in the World in 2015 World Trade Report 2016 (Source: WTO) Value $bn Share in world exports In 2015 1980 1990 2000 2015 China 175 4.0 8.9 18.2 39.3 EU28 112 28.7 25.2 Bangladesh 26 0.0 0.6 2.6 5.9 Vietnam 22 0.9 4.8 India 18 1.7 2.3 3.0 4.1 Turkey 15 0.3 3.1 3.3 3.4 Indonesia 7 0.2 1.5 2.4 Cambodia 6 0.5 1.4 United States 4.4 Vietnam and Bangladesh have emerged as two of the world’s biggest exporters of clothing over the last 20 years in part because of low relative unit labour costs attracting heavy FDI

Biggest Exporters of Manufactures in the World in 2015 ** Includes significant shipments through export processing zones World Trade Report 2016 (Source: WTO) Share of Global Exports (%) Value $bn 1980 1990 2000 2015 European Union 4239 43.0 36.6 China ** 2153 0.8 1.9 4.7 18.6 United States 1126 13.0 12.1 13.8 8.7 Japan 545 11.2 11.5 9.6 Korea, Republic of 470 1.4 2.5 3.3 4.1 Hong Kong, China 437 of which re=exports 432 México ** 312 0.4 1.1 3.0 2.7 Singapore 266 1.6 2.3 Taiwan 240 2.6 2.1 Canada 208 3.1 3.7 1.8 The Europe Union’s share of global exports in manufacturing has declined from 43% in 2000 to 36.6% in 2015. The share of the USA and Japan has also fallen significantly.

Economies by size of merchandise trade, 2015 In 2015, China was once again the world’s leading merchandise exporter and the United States the leading merchandise importer. The top five traders – namely China, United States, Germany, Japan and the United Kingdom accounted for more than one-third of world trade while the top three countries accounted for more than one-quarter. Source: World Trade Organisation Annual Review of Trade, data is for 2015

Key Abbreviations for Common Markets / FTAs ACP African, Caribbean and Pacific Group of States ASEAN Association of South-East Asian Nations AFTA ASEAN Free Trade Area CACM Central American Common Market CARICOM Caribbean Common Market CEMAC Economic and Monetary Community of Central Africa CIS Commonwealth of Independent States COMESA Common Market for Eastern and Southern Africa ECCAS Economic Community of Central African States ECOWAS Economic Community of West African States EFTA European Free Trade Association EU European Union MERCOSUR Southern Common Market NAFTA North American Free Trade Agreement SAARC South Asian Association for Regional Co-operation SADC South African Development Community SAPTA South Asian Preferential Trade Arrangement WAEMU West African Economic and Monetary Union Source: World Trade Organisation Annual Review of Trade, data is for 2015

TPP Partners in World Exports and Imports (% share) Source: World Trade Organisation Annual Review of Trade, data is for 2015