NEW DELHI: Pandemic-induced disruptions may see global merchandise trade plummet to a historic 18.5 per cent fall in the second quarter of 2020, at par with the lows of the 2008-09 financial crisis. According to the World Trade Organisation’s (WTO) Goods Trade Barometer, the Q2 reading of 84.5 was the lowest on record for trade data going back to 2007.
Compared to the year-ago period, the index was down 18.6 points, but the institution noted that there were indications of a slight recovery in the third quarter. “Additional indicators point to partial upticks in world trade and output in the third quarter, but the strength of any such recovery remains highly uncertain: an L-shaped, rather than V-shaped, trajectory can’t be ruled out,” it said.
Export orders from countries, including India, with a barometer reading of 88.4, have started showing signs of recovery. Indices for electronic components (92.8) and agricultural raw materials (92.5), too, have held up relatively well, showing only small declines.
For starters, a reading of 100 on the barometer indicates growth in line with medium- term trends; readings greater than 100 suggest above-trend growth, while below 100 indicate below-trend. Indices for automotive products (71.8) and air freight (76.5) have been by far the worst on record since 2007. Container shipping (86.9) also remains deeply depressed. The exact extent of the fall in trade will only be confirmed later this year when official trade volume data for April-June period become available.