Global Trade

 

Nothing Lasts Forever

Nothing lasts forever, you should know that by now
Good times, heartache
You'll get through this trouble though you may not know how
Your heart won't break

International Trade may be growing now, but that growth won't last forever

Growth follows a sigmoid, S, curve, whether it is the growth of animals from birth to full adult size, the total population of an island, etc.  A simple sigmoid curve is the hyperbolic tangent function, tanh. If you know the period over which the trade is going from no trade to full trade, and you know the value of full trade, then it is possible to make predictions about the value of international trade.  Based on fitting simple linear approximation to the observations, it looks as if the growth of trade is happening over 100 years, from 1974 to 2074, and that the first 25 years will show modest growth, the next 50 years will show the highest growth, and the last 25 years will be a return to the previous modest growth before full trade is achieved.  It is going from virtually no trade in 1974 to $45 trillion in 2074.  The annual trade may be more or less than the amount forecast, but it would be even more wrong to think that the current growth rate will continue indefinitely.