Are we seeing the beginning of a new global recession?

It may seem to be a relatively small point but, over the last 12 months, the dollar value of Singapore's non-oil trade has declined by almost 10%.  While the extent of this decline in Singapore's total trade has not yet been quite as great as that experienced during the Global Financial Crisis (GFC), the data is not that much better, either.  For Singapore itself, this situation is clearly troubling given the huge proportion of the economy that is accounted for by trade flows but the rest of the world would do well to take notice of Singapore's problems.  As one of the more open economies, Singapore can act as the proverbial "coal miners' canary" within the global economy and at present it seems not to be chirping very loudly....

In fact, over the years there have been a number of such useful canaries.  Korean exports and business confidence have also produced a good track record of forecasting wider global economic trends.  Currently, Korean export trends are on a par with those experienced during the near global recessions of the early 1980s and the early 1990s, although they are not yet as weak as those seen in the GFC and the early 2000s.  Korean business confidence has also proved a useful indicator of global trade conditions and this has recently declined very sharply as well, as has China's trade data, although that is not an overly accurate data series.

In Europe, Belgium, by virtue of its geographical location, can often provide a leading indicator for the rest of the region and currently business confidence as well as production levels are falling into what in previous episodes have been regarded as deeply recessionary levels.  Finally, the ECB's data on intra-regional trade is also beginning to suggest an ongoing contraction in nominal trade values that is at least on a par with that witnessed during the recession in the early 2000s.