Coronavirus hit to global trade ‘deeper but not as long’ as thought, as WTO sees recovery under way
- World Trade Organization (WTO) reduces size of global trade contraction in 2020, as lockdowns ease and economies reopen
- China accounts for 43.8 per cent of all personal protective equipment shipments in first half of 2020, WTO says
The WTO said global trade was now set to shrink by 9.2 per cent this year, with growth of 7.2 per cent forecast for 2021.
In April, when the effects of the pandemic on global supply chains were still uncertain, the WTO forecast that global trade would contract by between 13 per cent and 32 per cent this year.
“[Global gross domestic product] is doing worse than expected, while the trade decline is not as much as expected, compared to the great financial crisis [of 2008-2009]. Trade has been much more resilient this time around,” WTO chief economist Robert Koopman said.
Global trade in goods recorded its sharpest-ever quarterly decline in the second quarter, falling 14.3 per cent compared with the previous quarter and 17 per cent compared to the same period in 2019, the WTO said. But the situation has improved, “due to a surge in June and July as lockdowns were eased and economic activity accelerated”.
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Global trade decline will be ‘steepest on record’ in second quarter, WTO says
In April, China had come out of its own coronavirus economic shutdown, but Western markets were heading into lockdowns of their own. Many analysts predicted a “second economic wave” to hit the Chinese economy in the form of lower demand in the West.