Substantive chit

By: Barbados (chair, Caribbean community)

The perspective of economic issues before covid-19 in developed economies

 North America and Europe

1. Decline automobile production which led to
slowdown in trade
2. This weak performance of the automobile sector
forms part of global trend. In 2018, world production
of cars declined by 0.9 per cent, marking the first
global contraction in this sector since the global
financial crisis in 2008. The automotive industry is
one of the world’s largest economic sectors and is
labour and capital intensive. It has important impact
on global growth, employment and overall
development.
3. Weak global production of automobile is widely
attributed to fallen demand in China, where
automobile sales between January and July 2019
were 11.4 % lower as compared to 2018. Passenger
car registrations had also declined significantly in
countries like Australia, Canada, India, the United
States and even Europe. Germany is the world’s
biggest automotive exporter, and Europe is
particularly vulnerable to falling global demand for
automobiles.
4. The global automobile sector is also undergoing a
transition related to environmental standards, which
is resulted in decline of demand of automobiles.
5. Wages had been rising faster than productivity in
almost all European countries.
 Japan
1) Export decline as compared to 2018 in Japan
2) Import volumes also fell, to a smaller extent, by
1 %. There was a rapid decline in exports,
Japan’s trade balance remained in deficit. The
decline in exports reflects some shift in trade
patterns.

SOURCE:
1)
https://www.un.org/development/desa/dpad/
publication/world-economic-situation-and-
prospects-september-2019-briefing-no-130/
2)
https://www.imf.org/en/Publications/REO/EU/
Issues/2019/10/24/REO-EUR-1119