- Cross-border e-commerce is widely expected to be a key growth engine for the global e-commerce industry in the coming years. BI Intelligence estimates that, with current policies in place, global cross-border e-commerce will grow at a 29% CAGR from $330 billion in 2016 to nearly $1.18 trillion in 2021.
- However, the recent rise of economic nationalism in Western democracies is putting some of that growth at risk. The Brexit vote in the UK and the presidential election of Donald Trump in the US have raised questions about the future of cross-border e-commerce in the two countries, both of which are major hubs in the global market.
- Trump’s threats to withdraw from NAFTA and reshape trade policy with China could significantly hinder US cross-border e-commerce with Canada, Mexico, and China. Such moves could damage the country’s important position as a major exporter of cross-border online purchases. The cross-border e-commerce corridors between the US and Canada, and the US and China, specifically, are two of the largest in the world, while the US-Mexico corridor is smaller but growing.
- Meanwhile, Brexit could introduce new costs and complexity to the movement of goods between the UK and EU. About half of the more than 270 million e-commerce orders that UK retailers ship overseas annually go to EU residents, according to The Economist Intelligence Unit. That share surged late last year, as the value of the pound continued to decline against the euro.
- The US' and UK's prominent positions in the global cross-border e-commerce market depend largely on the final results of the Brexit and NAFTA talks. They're also contingent on how aggressively the Trump administration pursues its "America First" trade policies. A protectionist turn in US and UK trade policies would shift market growth to EU and Asia-Pacific countries.
Cross-border e-commerce is widely expected to be a key growth engine for the global e-commerce industry in the coming years, thanks to a convergence of consumer and market trends. Major retailers are already expanding their cross-border shipping options, and cross-border online purchases are set to grow twice as fast as domestic ones through 2020, according to a study released earlier this year by DHL. BI Intelligence estimates that, with current policies in place, global cross-border e-commerce will grow at a compound annual growth [...]