WTO reports show global trade decline has not been as severe as feared

The World Trade Organization (WTO) reported on Tuesday, June 23, that world trade of goods fell to a record low in the first months of this year due to the Covid-19 pandemic, but it is not the worst possible scenario. The agency predicted in April that global trade would decline by between 13-32%, before recovering by 21% to 24% in 2021.  According to the agency, the volume of merchandise trade shrank by only 3% in the first quarter, and initial estimates point to a decline of 18.5% in the second quarter.

The WTO said that governments reacted more quickly than in the crisis of 2008 and 2009, and support for income encouraged consumers to continue spending. Some sectors, such as automobiles, have fallen sharply, but others, such as electronics, have held up well. If trade grows 2.5% per quarter for the rest of the year, the most optimistic projection of a 13% decline could be made, although this is still even worse than at the height of the financial crisis in 2009, when trade declined by 12.5%.

Source: Agência Brasil

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