The World Trade Organization (WTO) has lowered its trade growth forecast for 2013 from 4.5 percent to 3.3 percent.
In a statement on Wednesday, the WTO attributed the revision to continued risks posed by the eurozone crisis and a rise in protectionism. It also said that trade had grown by a mere 2 percent in 2012; the second-worst figure since its records began in 1981.
In dollar terms, the value of the goods traded over 2012 remained stagnant in round valuation terms at US$18.3 trillion. The WTO said the valuation was unchanged because prices for coffee, cotton, coal and iron ore fell.
The WTO said that "improved economic prospects" for the US in 2013 should only partly offset the continued weakness in the European Union, whose economy is expected to "remain flat or even contract slightly this year according to consensus estimates".
Average growth rates over the past two decades had been 5.3 percent, it added. Despite concerns for the current year, the WTO said trade growth should rebound to about 5 percent in 2014.
WTO director general Pascal Lamy expressed fears that trading nations might turn to protectionism as other attempts to boost growth are "found wanting."
"There is a need for more rules-based trade in order to reduce unemployment and to stimulate growth...China's growth should continue to outpace other leading economies, cushioning the slowdown, but exports will still be constrained by weak demand in Europe," he added.
Follow CFO World Australia on Twitter: @CFOworld_AU, or take part in the CFO World conversation on LinkedIn: CFO World.
Join the CIO Australia group on LinkedIn. The group is open to CIOs, IT Directors, COOs, CTOs and senior IT managers.