Long-term trends and new developments in international trade

Abstract

The article reveals main trends in international trade development over the last decades. Major drivers of trade and increasing share of emerging countries are reviewed: robust economic growth in the developing world, especially in the Asian region, expansion of global value chains (GVCs), trade liberalization. Among important new developments in the current decade the authors focus on slower pace of global trade growth against the world GDP (falling elasticity of trade to aggregate demand); decreasing trade operations via GVCs channels in view of changing economic and technological factors, reshoring policies; weakening of liberalization incentives under WTO and regional trade agreements; the trend of rising development countries’ share in trade is no longer valid. The ongoing digital transformation and the fourth industrial revolution will generate bounding effects on international trade, at least in its traditional meaning. Virtual segment of global trade will be expanding rapidly and the trade itself will demonstrate deeper integration into national economies, becoming more an extra-spatial activity with direct participation of companies and citizens enabled by cloud technologies rather than exchange of values between countries.