The World Trade Centers Association (WTCA) unveiled its second annual Trade and Investment Report (www.WTCAReports.org), conducted in partnership with FP Analytics. The report details the key factors that enable cities to remain resilient as dramatic shifts in trade-and-investment policies intensify economic competition. Moreover, on-the-ground insights from interviews with WTCA members around the world reveal that the damage being caused to global trade and investment may be worse than is currently captured by traditional indicators.
Global trade grew 3 percent in 2018, but tariffs and other causes of uncertainty have already led the World Trade Organization to reduce its growth forecasts for 2019 from 3.7 percent to 2.6 percent. The reality could be worse if trade and investment are being artificially buoyed by companies trying to get ahead of impending tariffs or navigate around other barriers. WTCA members reported a surge in trade over the past year as businesses sought to lock in costs before Brexit, and before the trade tensions between the United States and China escalate further.
“Economic uncertainty has created a ‘new normal’ which businesses and organizations are being forced to confront,” said FP Analytics Managing Director Claire Casey. “This year’s report illuminates the underlying causes driving this economic upheaval as well as provides successful strategies to combat this new instability.”
How can cities survive fluctuations in the global economy and foster growth? Analysis of city-level economic data from the past five years found that cities that outperform their countries during economic downturns have a consistent set of traits. Regardless of their location or size, these cities all have relatively diversified economies, strong service sectors, educated populations, high shares of foreign citizens, and robust transport infrastructure. And they have defied the odds by attracting investment under adverse circumstances: Their FDI as a percentage of GDP was twice as high on average as that of nonresilient cities.
“The 2019 WTCA Trade and Investment Report shows that cities and businesses are being forced to consider new investment strategies and trade opportunities in a time where the global economy is in a state of near-constant flux,” said WTCA Chief Executive Officer (CEO) Scott Ferguson. “However, cities are well positioned to act as centers of economic stability and growth during shifting policy changes and uncertain global economic circumstances.”
The report was launched in Metz, France, alongside a panel discussion of its findings. WTCA CEO Scott Ferguson; Rolf Alter, Senior Fellow at the Hertie School of Governance in Berlin, and former Director of Public Governance at the Organisation for Economic Cooperation and Development; Rani Dabrai, Director of World Trade Center Dublin; and Bruce Nairne of Nairne Limited, a private-sector consultancy, shared their perspectives on the report and the challenges and opportunities for business in the current environment.
“Cities are where policies and people meet,” remarked Alter. He continued, “We are living in the Metropolitan century, and this report is rich with examples of what works to ensure a city’s resiliency in what is certainly a time of fundamental change. The practitioner’s point-of-view detailed by WTCA members here is insightful and important.”
The results of the full report, including commentary from WTCA Members, are available for download at www.WTCAReports.org.
Compliments of the Word Trade Center Association, a member of the EACCNY