WTO Estimates Global Trade to Shrink 18.5% in 2Q20

World Trade Organization (WTO) estimated global trade volume to shrink 18.5%YoY in the second quarter due to uncertainty around the pandemic’s severity and economic impact. 

The estimation was based on initial estimates for the second quarter when coronavirus and associated lockdown measures affected a large share of the global population. 

“These declines are historically large, but could have been much worse.” said Roberto Azevêdo, Director-General of the WTO.

Otherwise, the organization has set out two plausible paths on economic impact earlier in April: an optimistic scenario in which global trade volume in 2020 would contract by 13%, and a pessimistic scenario in which trade would fall by 32%.  

The estimation drop is even larger than a 3% shinkYoY in the first quarter according to WTO statistics.

In regarding to an economic recovery, WTO pointing ahead to 2021, believing economic growth could weaker than expected due to a possibility of COVID‑19 outbreaks resurgence  and widespread recourse to trade restrictions.

“World trade fell sharply in the first half of the year, as the COVID-19 pandemic upended the global economy. However, rapid government responses helped temper the contraction, and WTO economists now believe that while trade volumes will register a steep decline in 2020, they are unlikely to reach the worst-case scenario projected in April.” stated on the WTO report released on Monday, June, 22.