The value of global merchandise trade is predicted to fall by 5.6 per cent in 2020 compared with last year, according to UNCTAD’s latest nowcasts. This would be the biggest fall in merchandise trade since 2009, when trade fell by 22 per cent. This is a significantly more optimistic nowcast than only a few weeks ago when UNCTAD nowcasts were estimating a fall of 9 per cent.
The nowcasts – data-led projections for the immediate future – have been published on as part of UNCTAD’s comprehensive annual Handbook of Statistics for 2020, which presents the statistical landscape for 2019 with nowcasts for 2020.
However, the predicted decline in services trade is much greater, with services likely to fall by 15.4 per cent in 2020 compared with 2019. This would be the biggest decline in services trade since 1990, when this series began. In 2009, following the global financial crisis, services trade fell by 9.5 per cent. UNCTAD’s quarterly International Trade in Services Bulletin, which contains the latest detailed information, shows that this plunge has been driven by a considerable decline in travel, transport and tourism activity.
The handbook usually presents a wide variety of statistics relevant to international trade and development for the preceding year and has recently included nowcasts to anticipate the figures for the year of publication.
The coronavirus pandemic however transformed business as usual in 2020, increasing demand for up-to-date figures on the economic impacts while also impacting statistical modelling. “Unlike previous years however, the models that nowcast international trade and GDP had to grapple with some of the most unusual circumstances in living memory,” said UNCTAD’s chief statistician Steve MacFeely. “So much so, the existing models broke down under the strain and had to be redesigned and rebuilt during the year.”
The nowcast figures are telling however and paint a picture of the schism that happened in trade in both goods and services as a result of the coronavirus pandemic, with the figures still trending downwards at time of publication.
“While the handbook maps and presents the situation for global trade in merchandise and services, maritime, population, and other economic trends in 2019, there is a more pressing need to nowcast for the economic impacts of the pandemic,” said MacFeely.