From "Trade-Finance Pinch Hurts the Healthy," WSJ, 12/22/08:

The global financial crisis is drying up the financing that firms depend on for trade. That's making the global recession nastier and deeper than it otherwise would be.

As with all kinds of credit these days, financial institutions are making less trade finance available and charging more for it. But the squeeze in trade stands out because it pinches otherwise healthy companies that should be driving a recovery in global commerce. Already, the World Bank predicts trade will contract next year for the first time since 1982.

The Deteriorating Trade Outlook

Here's the IMF's recent forecasts for exports -- from October and then November -- for world trade, disaggregated into advanced and developing country groupings.

Figure 1: Real goods and services exports by country group. Source: IMF, World Economic Outlook Oct. 2008; Nov. 6 WEO update.

These developments in trade financing suggest that

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Last Thursday, I had the opportunity to participate in a panel on Global Economic Crisis: The Untold Stories, sponsored by the Center for World Affairs and the Global Economy (WAGE). I was tasked with surveying the impact on the economy outside the borders of the United States -- in 20 minutes.

Here's the link to my presentation, but I reproduce one of the key slides here:

Figure 1: Growth rates of real goods and services exports (y/y), by country group. Source: IMF, WEO Oct. 2008 database; Nov. 6 WEO update.

What's of greatest interest to me is how rapidly estimates of emerging market and LDC export growth were revised downward, going from the October to November projections. This only reinforces my view that the US slowdown will have a disproportionate impact on world trade given the drastic change in the role of the

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