WTO’s Merchandise Trade Index Falls to Record Low as Covid-19 Disrupts Global Economy

The World Trade Organization (WTO)’s goods trade indicator fell sharply to 87.6 from the 95.5 recorded in February 2020 -the lowest since its launched the index in 2016- showing a steep decline in global goods trade as COVID-19 disrupts world economy.

 

The indicator consisted with the WTO’s trade forecast issued in April, which projected a decline in world merchandise trade of between 13% and 32% in 2020.

 

However, the report said that world trade has already slowed down even since before the pandemic as the volume of merchandise trade shrank by 0.1% in 2019, which made as the first annual decline since 2009. “Trade was relatively weak in the final quarter of 2019, but this is unlikely to have been influenced by COVID-19”.

 

In addition, other indicators are currently well below trend, such as the automotive products index (79.7) was weak due to collapsing car sales in major economies, a sharp decline export orders (83.3) and agricultural raw materials (95.7), even it showed signs of stability, otherwise remaining below trend.