G20 merchandise trade fell for the first time in two years in value terms in Q3 2022, retreating from the recent high levels in Q2 2022 (Figure 1 and 2). As measured in current US dollars, exports and imports contracted by 1.3% and 1.1%, respectively, as global demand began to slow and most commodity prices receded from their peaks. Falling oil prices weakened merchandise exports in North America in Q3 2022, with the United States and Mexico recording positive but slower growth than in the previous quarters. In the European Union, merchandise exports and imports contracted by 1.5% and 0.7%, respectively. In the United Kingdom, exports grew by 0.8%, while imports fell sharply by 9.9%. Merchandise trade remained weak in East Asia, despite the increased sales of electronics and machinery. Exports fell by 0.3% in Japan and by 1.0% in Korea, but picked up by 0.7% in China. Following several quarters of sustained growth, leading commodity traders in the G20 saw a decline in merchandise exports, partly reflecting cooling demand and falling prices.

“It is too early to draw any concrete conclusions, however this latest development in G20 merchandise trade deserves further monitoring as the global economy confronts multiple headwinds, including monetary tightening, receding commodity prices, and cooling demand,” said OECD Chief Statistician Paul Schreyer.

G20 services trade slowed further in Q3 2022, as measured in current US dollars (Figure 1 and 2). Export growth is estimated to have flattened to 0.3% and imports to have grown by 1.7%. This compares to the higher rates recorded in Q2 2022 (1.3% and 2.3%, respectively), as falling shipping costs weighed on the value of transport services across many G20 economies. Similar to merchandise, growth in services trade slowed markedly in North America. Across Europe, the largest services traders recorded falls in exports and rising imports. For the first time since Q2 2020, France recorded a decrease in services exports, while higher travel expenditure abroad boosted imports. German exports also declined, reflecting lower intellectual, telecommunication and other business services, whereas imports rose. In the United Kingdom, services exports and imports each decreased by 3.3%. In Japan, exports flattened and imports soared, fuelled by travel. In China, services exports rebounded strongly, driven by higher sales of business, computer and intellectual property services, while imports declined by 0.4%.