Trade forecasts for 2011 revised downwards

(a) Global economy is expected to grow by 4.0 per cent in 2012 with looming uncertainties
The IMF, in its latest September 2011 World Economic Outlook report, expects the global economy to grow by 4.0 per cent in 2012. Global outlook for 2012 is shrouded with uncertainties, with downside risks dominating upside risks. Possible downside risks include fears of a global recession as a result of worsening Eurozone sovereign debt crisis, and tightening credit conditions for emerging economies which may impact their growth.

(b) Continued weakness in the Eurozone economy
The EU 27 economy is not expected to see any quick fix to the escalating euro area debt crisis and hence, this will continue to dampen consumer and business sentiments, going into 2012. Thus, the economy will continue to be weak in 2012.

(c) Anaemic growth of the US economy
The US economy is expected to continue on its sputtering growth path in 2012 with a 1.8 per cent growth. Soft hiring conditions and the continued weak housing market are expected to contribute towards its anaemic growth.

(d) Moderation in growth of the Asian economies
Most Asian economies are expected to grow in 2012 but at a more subdued pace compared to 2011. China is expected to lead the growth, fuelled by its domestic demand. Chinese trade partners including Singapore are expected to benefit from this demand.