Brussels – Global merchandise trade fell by a record amount in the first months of the year due to the COVID-19 pandemic, but stopped short of a worst-case scenario, the World Trade Organization (WTO) said on Tuesday (23). The body had forecast in April that global trade in goods would fall by 13-32% in 2020, before rebounding by 21-24% in 2021.
In fact, the volume of merchandise trade in fact shrank by 3% in the first quarter, the WTO said, and initial estimates pointed to a year-on-year decline of 18.5% for the second quarter. “The fall in trade we are now seeing is historically large – in fact, it would be the steepest on record. But there is an important silver lining here: It could have been much worse,” WTO director‑general Roberto Azevedo (pictured above) said.
The WTO said governments reacted quicker than in the 2008-2009 crisis and income support encouraged consumers to keep spending. Some sectors such as automobiles fell sharply, but others such as electronics have held up well. If trade grows by 2.5% per quarter for the rest of the year, the more optimistic projection of minus 13% could be met, though that would still be worse than at the height of the financial crisis in 2009, when trade dropped by 12.5%.
Translated by Guilherme Miranda
