The report, which focuses on the period from mid-October 2019 to mid-May 2020, covers new trade and trade-related measures implemented by WTO members.
While the full impact of the COVID-19 pandemic cannot be fully assessed as it is not yet entirely reflected in trade statistics, it has undoubtedly caused social disruptions and altered the global economy. However, it is important to note that before the world entered a pandemic Global trade had already begun to slow down due to slowing global economic growth and heightened trade tensions. In 2019, merchandise trade growth was down by 0.1% and 3%, respectively, for the first time since 2009. In spite of this, however, commercial services exports increased by 2% in 2019 although the pace of growth was down sharply from 9% in 2018.
In its April 2020 trade forecast, the WTO came up with two scenarios as possible outcomes for the global crisis, one more optimistic than the other. The optimistic outlook sees the volume of world merchandise trade contracting by 12.9% and world GDP slipping by 2.5%, while the more pessimistic outlook sees reductions by 31.9% and 8.8%, respectively. Data and indicators in mid June show that the outcome was more consistent with the optimistic scenario; however, this does not necessarily mean that the pessimistic predictions or worse cannot still be realized, as it that final result largely depends on the changes between now and the rest of the year.
To maneuver in this new trading environment, WTO members and observer’s implemented 363 new trade and trade-related measures: 198 trade-facilitating and 165 trade-restricting. 256 of the total measures were COVID-19 related, 147 trade-facilitating, and 109 trade-restricting. Most of these measures were implemented in the early stages of the pandemic; however, by mid-May 57% of COVID-19 related measures were actually trade-facilitating and about 28% of the trade restrictive measures had been repealed by members. One hundred and seven (107) of the other measures undertaken were not COVID related, of which 51 measures were trade facilitating. In particular, those which were import-facilitating brought in an estimated value of USD $739.4 billion, the second-highest figure for such measures since October 2012. The other 56 measures, trade-restrictive, estimated for a trade coverage of USD $423.1 billion, the third-highest value recorded since October 2012. All the Import-restrictive measures implemented since 2009, and still in force, are estimated to affect 8.7% of world imports (USD 1.7 trillion).
In terms of services, most of the measures introduced by members were trade-facilitating, especially in response to the pandemic. However, a number of measures were trade-restrictive; these came in the areas concerned with strategic and national security as well as related to foreign investment.
The report also highlights economic support measures taken as part of the overall trade policy of members. 468 COVID-19-related general economic support measures were identified among members in response to the economic and social turmoil caused by the pandemic. These measures mostly included credit guarantees, stimulus packages, monetary, fiscal and financial measures as well as preferential loans. Collectively worth trillions in US dollars, these measures have been taken by governments to stimulate their economies during this time of economic downturn and to prepare the ground for a strong recovery.