WTO Forecasts 2020 Global Trade to fall by 13%-32% Due to Covid-19 Disruption

The World Trade Organization or WTO on Wednesday has released a global trade forecast of 2020, expecting to fall by between 13% and 32% as the Covid-19 pandemic disrupts normal economic activity and human life across the world.

 

As an unprecedented health crisis, it could widely range of possibilities for the global economic, the outcomes has yet to determine as depending on the duration of the outbreak and the effectiveness of the policy responses, neither estimates of the expected recovery in 2021 are also uncertain, 

 

“This crisis is first and foremost a health crisis which has forced governments to take unprecedented measures to protect people’s lives,” WTO Director-General Roberto Azevêdo said.

 

“The unavoidable declines in trade and output will have painful consequences for households and businesses, on top of the human suffering caused by the disease itself.”

 

“The immediate goal is to bring the pandemic under control and mitigate the economic damage to people, companies and countries. But policymakers must start planning for the aftermath of the pandemic,” he said.

 

Falling by 13% is an optimistic scenario, however, if the virus spreading worldwide could not push under control soon, the decline of global trade could be as much as 32% or more.

 

Comparing to financial crisis of 2008–09 or even the Great Depression in 1929 is something far-off as this actual crisis comprises of economic and health issues. The restrictions on movement and social distancing to slow the virus outbreak mean that labor supply, transport and travel are today directly affected in ways that were not during the financial crisis.