The World Trade Organization (WTO) on Wednesday forecast that the goods trade would shrink more steeply this year than in the global financial crisis a decade ago before rebounding in 2021, as the COVID-19 pandemic recedes – provided countries worked together to confront the challenge.
The pandemic could provoke the deepest recession in living memory, WTO chief Roberto Azevedo warned.
"As we face what may well be the deepest economic recession or downturn of our lifetimes, we should aim to make the most of all potential drivers of sustainable growth to reverse this situation," he told a virtual news conference in Geneva.
The WTO said global trade would fall this year by between 13% and 32%, giving a wide range because so much about the economic impact of the health crisis was uncertain.
"These numbers are ugly – there is no getting around that," Azevedo said. "But a rapid, vigorous rebound is possible. Decisions taken now will determine the future shape of the recovery and global growth prospects."
Keeping markets open and predictable, he said, would be critical to spurring renewed investment. Countries working together would see a faster recovery than if each country acted alone.
The Geneva-based WTO said that for 2021 it was forecasting a rebound in the global goods trade of between 21% and 24%, depending largely on the duration of the coronavirus outbreak and the effectiveness of policy in response.
The WTO also confirmed that 2019 had ended on a somber note, with a 0.1% decline in goods trade, weighed down by trade tensions, notably between the United States and China, and an economic slowdown.
In October, the WTO forecast trade growth would grow 2.7% in 2020 after expanding 1.2% in 2019.
It said that this year, nearly all regions would suffer double-digit percentage declines in trade, with exports from North America and Asia the hardest hit. Sectors with complex value chains, such as electronics and automotive products, would also see steeper falls.
Services are not included in the WTO's forecast, but the WTO said trade in this area may be hit hardest by COVID-19 because of transport and travel restrictions.
