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Coronavirus: WTO warns of trade slump on a scale not seen since 1930s

Global trade could collapse this year on a scale that draws parallels with the Great Depression of the 1930s, the WTO has warned.
The World Trade Organisation forecast a decline of between 13% and 32% in 2020 - giving a wide range because there was so much uncertainty about the economic impact of the coronavirus crisis.
Even at the lower end, that would surpass the 12.5% drop seen at the height of the financial crisis just over a decade ago.
WTO director-general Roberto Azevedo said: "These numbers are ugly - there is no way around that.
"Comparisons with the financial crisis of 2008 and even the Great Depression of the 1930s are inevitable."
But Mr Azevedo added that unlike then, banks are not short of capital and the "economic engine" is in "decent shape".
"The pandemic cut the fuel line to the engine," he said.
"If the fuel line is reconnected properly, a rapid and vigorous rebound is possible."
The WTO predicts a rebound of between 21% and 24% in 2021 - depending on how quickly the pandemic is brought under control, and whether governments work together.
"A turn towards protectionism would introduce new shocks on top of those we are currently enduring," Mr Azevedo said.
"Keeping markets open to international trade and investment would help economies recover more quickly."
Trade tensions - particularly between the US and China - led to a 0.1% in global goods trade last year.
The WTO predicted 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.
Countries in Europe are beginning to count the economic cost of the crisis.
France's central bank said on Wednesday that it has already fallen into recession and leading forecasters in Germany have pencilled in a 4.2% GDP decline for that country this year.
Source: news.sky.com
Apr 11, 2020 12:20
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