I have just discovered a set of global trade statistics updated monthly by the Dutch Bureau for Economic Policy Analysis (CPB). (Incidentally, this is not the first time I’ve come across excellent work by the CPB – their work on administrative burdens imposed by regulation is essentially the international pioneer on the topic and has informed EU thinking on how to cut red tape.)
Rather than hundreds of words of rapier-sharp analysis, I thought I would just post one graph that I thought was the single most shocking thing I’ve seen this recession yet: Japan’s trade figures.
While Japan may have been ‘over-exporting’ – or at least ‘under-importing’ if domestic demand is moribund – the 40% year-on-year collapse in exports cannot be written off as just another statistic. Presumably driven by exports of cars, this has to make for dismal reading. China is not far behind, it seems, with exports down almost 20% year-on-year in late 2008.
As far as I know, even open countries such as Estonia (down 10%), Singapore (down 20%) and Ireland (down just 1%) have seen falls in exports but nothing like 40%. (Interestingly, imports have collapsed in Ireland, down almost 30%, while exports are static – are multinationals just clearing their output?)
For those who think this whole post is just far too optimistic, to REALLY depress yourself, have a look at this global – rather than US – comparison of the 1930s and today, A Tale of Two Depressions, by Kevin O’Rourke and Barry Eichengreen. As they note in their conclusion:
The world is currently undergoing an economic shock every bit as big as the Great Depression shock of 1929-30. Looking just at the US leads one to overlook how alarming the current situation is even in comparison with 1929-30. The good news, of course, is that the policy response is very different. The question now is whether that policy response will work.