Novel coronavirus pneumonia crisis was strongly revival in the latest global trade update report released by the joint China World Trade Center Conference on May 19th (UNCTAD). Its momentum in the first quarter of 2021 was a record high, an annual increase of 10%, a quarter increase of 4%. At present, the rebound momentum of Global trade continues to benefit from the promotion of trade in goods to a large extent, while trade in services continues to lag behind.
The report points out that the current rebound momentum of Global trade will continue until the second quarter of 2021, when the total value of Global trade in goods and services is expected to reach US $6.6 trillion, an increase of about 31% compared with the lowest point in 2020, and an increase of about 3% compared with the pre epidemic level in 2019. It is estimated that global trade will maintain a strong growth momentum in the second half of 2021. Compared with the lowest point in 2020, the annual growth rate of 2021 will be about 16%, of which the trade in goods will increase by 19%, and the trade in services will increase by 8%. Fiscal stimulus plans launched by various countries, especially developed countries, are expected to strongly support the global trade recovery in 2021. Trade growth in East Asia and developed countries will continue to be strong. Driven by the rising trend of commodity prices, the value of Global trade will rise accordingly. In addition, the positive prospects of Global trade in 2021 largely depend on the further reduction of epidemic blockade and restrictive measures, the continued upward trend of commodity prices, the comprehensive restriction of trade protectionism policies, and the macroeconomic environment and financial situation of countries supporting economic and trade recovery. Overall, there are still uncertainties in the global trade pattern.
From the perspective of trade trends of major economies, their trade began to recover in the autumn of 2020 and continued to the first quarter of 2021, but the main reason for this substantial growth is the low base in 2020. At present, trade in many major economies is still below the 2019 average. The recovery momentum of trade in goods of major economies is stronger than that of trade in services, which is a common feature of trade trends of all major economies. The trade performance of China, India and South Africa in the first quarter of 2021 was relatively better than that of other major economies. In particular, China's exports are not only higher than the average level in 2020, but also have a strong growth momentum higher than the level before the epidemic. By contrast, Russia's exports are still far below the 2019 average.
From the perspective of regional trade trend, in the first quarter of 2021, compared with developed countries, the trade of developing countries continued to show a stronger rebound momentum. Compared with the first quarter of 2020 and the first quarter of 2019, the value of imports and exports of developing countries' commodities increased significantly, by about 16%. The trade of East Asian economies is more important to promote the trade recovery of developing countries, that is, South South trade. In all regions, only East Asian and Pacific economies showed a strong rebound in exports, while the exports of transition economies, South Asia and Africa were still below average. South American exports increased compared with the first quarter of 2020, but still below the average level in 2019.
Novel coronavirus pneumonia, which is a major sector of the global trade, has recovered from the trend of trade in the first quarter of 2021. Trade in new industries such as pharmaceuticals, communications and office equipment has continued to rebound, and trade in minerals and agricultural food has also increased. In contrast, the energy industry continues to lag behind, and the international trade in transport equipment is still far below the average level.
The report points out that in 2021, Global trade will have the following trends:
First, the progress of global economic and trade recovery is uneven. Some economies rebound more strongly and faster than others. The economic recovery of China and the United States is expected to become the main driving force of global growth in 2021, especially for countries with high degree of trade integration with China and the United States, such as East Asian countries, Canada and Mexico. This novel coronavirus pneumonia has benefited from the East Asian economies, their early success in alleviating the epidemic and the rapid demand for new products of the crown pneumonia, which has helped to restore their economic and trade. In other developing regions, the recovery of trade is relatively slow. Trade in developed countries has generally improved. The novel coronavirus pneumonia epidemic is expected to continue to interfere with China's economic and trade recovery process in 2021.
Second, the operation mode of global value chain may further evolve. The novel coronavirus pneumonia has brought uncertainty to the operation of many global value chains, and also provided incentives for enterprises to segment the market and transfer production activities to consumers. The continuous development and implementation of regional trade agreements, such as RCEP and afcfta, the continuous trade tensions among major economies, the continuous shortage of containers and rising freight rates, may also lead to further evolution of global value chain production mode.
Third, the relevant policies and intervention measures of governments will continue to affect the process of international trade and economic and trade recovery after the epidemic. The diplomatic frictions between some major economies and the current difficulties in the multilateral trading system may have a restraining effect on Global trade. In addition, efforts to promote a sustainable recovery process with more social and environmental effects may affect the existing global trade model.
Fourth, the rising global debt level has brought instability to the macro economy. During the novel coronavirus pneumonia crisis, governments may borrow more money to maintain their economies, which may lead to financial instability. Even if there is no comprehensive global debt crisis, the increasing debt and debt service obligations may bring instability to the global economy. Any increase in interest rates will bring pressure on national and private borrowing, and have a negative impact on investment and international trade flows, especially for developing countries with limited fiscal policy space.
Fifthly, the consumption trend of consumers may change for a long time. During the novel coronavirus pneumonia epidemic, consumer behavior has undergone major changes. Demand has increased in some sectors, such as health products, digital services, communications and home office equipment, while it has decreased in others, such as transport equipment, international travel and reception services. If some of these changes persist, they will affect consumers' demand for foreign goods and services（ (Yang Haiquan, Geneva correspondent of economic daily)
