As global trade is moving upwards, Korea's economic growth will also likely benefit from it. The International Monetary Fund recently put out an outlook that the global trade growth rate would double this year from last year's below 2-percent level. If it indeed materializes, it would be the first time for the global trade growth rate to recover the 2014 level.
The higher growth pace in major economies such as the United States, Europe, and Japan is great news for an export-led economy like Korea. The question for Korea is whether it can overcome the wave of protectionism and China's retaliation in the wake of THAAD.
The Korean economy, an economy highly dependent on the external sector, has suffered a setback for years due to the sluggish growth of world trade until last year. The world's trade growth rate that reached as high as 12.4 percent in 2012 fell to a low of 2.7 percent in 2015 and 1.9 percent in 2016 (estimated by the IMF). These are lower than the average economic growth rate of the world during the same period.
The wind, however, is changing now. The IMF adjusted in January this year its global growth rate forecast from 3.1 percent to 3.4 percent while raising the forecast for the world's trade growth rate from below 2 percent last year to 3.8 percent.
Positive signs started showing late last year. The Bank of Korea said in a publication "Overseas Economic Focus" on April 2, "Global trade is slowing showing signs of recovery from the second half of last year. The trade in emerging market economies is rising fast of late."