EM Contagion: Based on Exports, Global Economic Growth appears to be Downshifting Fast

I have pointed to the recent collapse of exports by China and by Japan as potential harbinger of a substantial downshift in the growth rate of the global economy. 

Signs are that the world will be faced with a dramatic decline in the rate of growth if measured in exports. 

First of all here is the list of the top 15 exporting countries as provided by wikipedia.org

These countries, whose estimated US dollar priced exports at $13.885 trillion for 2013, constitute a substantial share in the (non-fixed) pie of global exports.

I have no figures for total world exports in 2013. So while this would be apples to oranges, if I use the above to compare with 2011 global export data then the top 15 countries would account for about 78% of global export share. A WTO report says that the share of the top 5 exporters represents 36% in 2012 almost equal to the trading volume of regional trading blocs. The point is to show the importance of the share of the above exports relative to the total.

Now aside from China and Japan here are the export trends of the other top 15 exporters

Eurozone exports have been in a sharp decline over the past (3 months) quarter.

But Eurozone performance have been unequal. Seen in the context of some of the Eurozone members within the top 15 ranking, German exports (ranked 3rd in the world) remain buoyant although markedly down from September highs. French exports (ranked 5th) have stagnated through most of 2013 compared to 2012 level. Spanish exports have substantially declined over the past 3 months while Italian exports marginally slowed over the same period.

Meanwhile US exports have been slightly down

South Korean exports have also been in a substantial downtrend. February exports plummeted by 5.7%. February data signifies a decline of 8.5% from October highs

Netherland exports fell sharply down by 5.3% in December (no latest updates yet)

Russia’s exports, ranked 8th in the world, have collapsed last January! Russian exports cratered by 19.8% (m-o-m), and have essentially mirrored China. 

Meanwhile Hong Kong exports have been marginally down.

Ninth largest exporter, the United Kingdom broke the 5 month declining trend with a 2.1% (m-o-m) gain last January. Has this been a quirk or a recovery?

11 spot Canadian exports has also shown a marginal decline over the past 5 months. 

13th ranked Singapore exports posted a modest increase (2.86% m-o-m) in January but the gains have been far off from the highs of October. 

Saudi Arabian exports have been strong as of the third quarter of 2013

15th spot Mexican exports tanked by 15.73% (m-o-m) in January! 

To have a better view of emerging markets where we can see the extent of the recent damage, let us take a look at the export data of the other majors. 

Brazil’s exports have stagnated in February following a 23% crash in January.

India’s export trend has been in a moderate decline over the past 5 months.  

In Southeast Asia, Malaysia’s exports though posting a marginal decline in January, has remained robust relative to most of 2013.  

Meanwhile Thailand’s exports have fallen sizably over the past 5 months.  

And after a spike in December exports, Indonesia’s January data plunged by 14.63%. Indonesian exports collapsed in August 2013 but recovered until December.  

Following September and October highs Philippine exports have moderately declined over the past 3 months

In sum, for the top 15 only Saudi Arabia, Germany, UK and Singapore have shown recent export (marginal to modest) gains, whereas the export declines have been pronounced in emerging markets (e.g. Russia, Mexico, South Korea). And this has become even more evident with the inclusion of Brazil, Indonesia and Thailand.

The dramatic fall in Japan, the marked slowdown in the Eurozone and the recent downshift in US exports may be signs of the deepening emerging market contagion. 

Emerging market financial market disruptions seem to have now been manifesting real economic effects through the global economy.

Yet the current rate of decline in exports of emerging markets seems alarming. 

[As a side note, this is a treatment of aggregate exports without delving into their details]

And they seem to be reinforcing my fears and suspicions. As I wrote early February, 

If emerging markets has been attributed by some as having pulled out the global economy from the recession of 2008, now will likely be the opposite dynamic, the ongoing mayhem in emerging markets are likely to weigh on the global economy and equally expose on the illusions of strength brought upon by credit inflation stoked by inflationist policies.

All these comes as major stocks markets seem to be in various stages of a mania (either from record highs or for those bourses fighting off the bear markets with violent denial rallies).

It is interesting to see if there will be a collision course between global real economy and the steroid dependent stock markets hoping for a sustained economic recovery.

P.S. Thanks to the wonderful tradingeconomics.com for all the charts and the very helpful data they provide.