Future of Trade 2030:Trends and markets to watch – new research by Standard Chartered – projects that global exports will almost double from USD17.4tn to USD29.7tn over the next decade.
The report reveals 13 markets that will drive much of this growth, identifies majorcorridors,and five trends shaping the future of global trade.Vietnam is a key driver of this global trade growth, with its exports projected to grow at an average annual rate of more 7 per cent to cross USD535bn by 2030.
Additionally, the research found that 41 per cent of global corporates currently do or plan to manufacture in Vietnam within the next five to 10 years. This is evidence that Vietnam will be a major driver of global trade growth over the next decade.
Future growth corridors
The USA and Mainland China will continue tobe the largest export corridors for Vietnam,accounting for 26 per cent and 19 per cent of total exports in2030, respectively.
India is a fast-growing export corridor for Vietnam with 11 per cent average growth per year from 2020 to 2030.
Future growth sectors
Vietnam is an emerging manufacturing powerhouse with expanding international trading relationships.
“Vietnam is a growing global manufacturing hub as foreign firms continue to invest in the market, incentivised by the availability of labour, geographical proximity to global supply chains, and its foreign direct investment-friendly policies. The country also benefits from strengthening international integration through multiple free trade agreements (FTAs), such as EU-Vietnam FTA, UK-Vietnam FTA, RCEP and CPTPP, allowing it to expand its exports, move up the value chain across sectors, and create skilled jobs. We are very positive about Vietnam’s future trade growth and committed to offering our support by leveraging our unrivalled international network and deep local knowledge.” said Michele Wee, CEO of Standard Chartered Vietnam.
The research, based on economic modellingfor export projections,also includes a survey of more than 500 C-suite and senior leaders in global companies.
Global trade will be reshaped by five key trends: thewider adoption of sustainable and fair-trade practices; a push for more inclusive participation; greater risk diversification; more digitisation and a rebalancing towards high-growth emerging markets.Almost90 per cent of the corporate leaders surveyed agreed that these trends will shape the future of trade and will form part of their five to 10-year cross-border expansion strategies.
Globalisation will drive the next decade of growth. Despite the recent push towards onshoring, growth corridors of the future will not just be intraregional – they will be global spanning Africa-East Asia; ASEAN-South Asia; East Asia-Europe; East Asia- Middle East; East Asia-Europe; South Asia-US.
Asia, Africa and the Middle East will see a ramp-up in investment flows, with 82 per cent of respondents saying they are considering new production locations in these regions in the next five to 10 years, supporting the trend towards rebalancing to emerging markets and greater risk diversification of supply chains.
Enabling sustainable supply chains
The research found a significant trend towards the adoption of sustainable trade practices in response to climate concerns and a rising wave of conscious consumerism. However, while almost 90 per cent of corporate leaders acknowledged the need to implement these practices across their supply chains, only 34 per cent ranked it as a ‘top three’ priority for execution over the next five to 10 years.
Standard Chartered, in line with its commitment to help make global trade more sustainable and drive the transition to Net Zero, launched a Sustainable Trade Finance proposition to enable companies to build more sustainable and resilient supply chains. In addition, we offer a suite of sustainable finance solutions to channel capital towards helping companies achieve their Net Zerogoals.
Simon Cooper, CEO Corporate &Institutional Banking and Europe & the Americas, Standard Chartered, said: “The predicted doubling of global trade offers strong evidence that globalisation is still working, despite recent dislocation.In addition to the growth of intra-regional trade pathways, the corridors of the future will still cut across continents.
He added: “Against this backdrop, we continue to focus on making globalisation work for more markets and businesses,ranging from micro to multinational, and drive a more sustainable and inclusive model for global trade. This includes growing our range of sustainable finance solutions to help our corporate clients implement sustainable and fair-trade practices across their supply chains.”