Wednesday May 23 10:27 AM ET WTO Predicts Rise in Goods Trade By NAOMI KOPPEL, Associated Press Writer GENEVA (AP) - The World Trade Organization (news - web sites) predicted a 7 percent rise in global trade in goods this year in its annual report Wednesday, but later admitted it might have been too optimistic. ``I was hoping that Western Europe, which has a large chunk of world trade, could actually compensate for the downturn in the United States, but the actual numbers which are coming in for the first quarter diminish this hope strongly,'' Michael Finger, acting director of the WTO's economics research division, told reporters. Finger declined to give a revised figure, but said he now thought 7 percent was ``at the upper end of the range.'' Even at 7 percent, the rate would be well below last year's 12 percent increase, which took the value of world goods trade above $6 trillion for the first time, according to WTO figures. ``The deceleration of global trade growth has set in during the final months of 2000 and is expected to continue for most of 2001,'' the report said. The severity of the downturn will depend on the United States, and especially on the ``new economy'' based on information technology, the 151-page report said. The sharp drop in stock market prices for high-tech companies indicates that their near-term outlook ``has become rather sober,'' it said. The report said that world goods trade last year totaled $6.2 trillion. Measured in volume terms, that was an increase of 12 percent, the fastest rate in more than a decade. Exports and imports were both up more than 15 percent in Asia and in Eastern Europe and the former Soviet republics. The increase was fueled by the continued success of the information and telecommunication sector, the WTO said. More than 410 million mobile phones were sold, an increase of 46 percent compared with 1999, and sales of semiconductors rose by 37 percent to $204 billion. The increase in fuel prices led to a huge jump in the value of exports from Russia and the major oil exporters in Africa. The report recorded an increase of 69 percent in the combined value of exports from Angola, Algeria, Republic of Congo, Gabon, Libya and Nigeria, while the value of Russian exports rose 62.1 percent. Over the past decade, however, the biggest winners in value of exports were Mexico and China, which recorded average growth of 15 percent a year. The United States continued to import more goods than it exported, leading to a 2000 trade deficit of $450 billion. The report attributed the deficit to the investment and consumption boom in the United States and the strength of the dollar. ``While it seems unlikely that this trend can be sustained, it is difficult to predict when the reversal will occur,'' the report said. Trade in commercial services is estimated to have expanded by 5 percent to $1.4 trillion, with exports from China increasing by a quarter. Only Western Europe recorded a drop in services exports. The United States exported $274 billion of commercial services in 2000 - one-fifth of the global total and a 10 percent increase on the previous year. Its imports totaled $199.3 billion, up 14 percent on 1999. -
