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Covid 19 Impact on Global Trade

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Economic Impact of COVID19 on global trade

The livelihoods and lives of many has been affected by the Covid 19 pandemic. There

was a devastating disruption of the global economy in the process, with the whole world feeling

the effects. In 2020, the global merchandise trade flow experienced a decrease of 14.3 percent

(Liu, Ornelas, and Shi, 2021). The dimensions of Covid 19 that affected international trade

include; the pandemic's impact in the third world countries, the measures to curb the spread of

the virus, the government consequences, behavioral changes, and its direct health impact.

The 14.3% global merchandise fall during the second quartile of 2020 was the most

significant one-time fall ever experienced in history. This shows how hard hit the global

economy was by the pandemic. Other effects were decreased demand and supply due to the

mitigations and guidelines set aside, especially during the lockdown (Liu, Ornelas, and Shi,

2021). A forecast in 2020 showed that it was expected to fall by 9.2%.

The effects of the pandemic at the country level can go either way, even though most of

us expect adverse effects due to the pandemic. The pandemic, as expected, did deliver a shock to

the demand and supply side. During the onset of the pandemic, most people did forecast the fall

of international trade and most forecasts were accurate. The economy hit a recession, and the

supply of goods and the demand (Liu, Ornelas, and Shi, 2021). Later during the lockdown, a

partial rebound was experienced in the northern hemisphere.

In conclusion, the effects of Covid global trade should not surprise the world, and that is

why there is a need for scrutiny of fine refined data. The economy seems to be going back on

track. Covid 19 is still in effect even in 2021, even though a difference might be felt from the

onset of the pandemic. The global merchandise is back on track. The global trade will need more
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time to reset and go back to the old norms. The effects of the new measure on trade is a good

research question for the future.

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Reference
Liu, X., Ornelas, E., & Shi, H. (2021). The Trade Impact of the Covid-19 Pandemic.
https://voxeu.org/article/2020-trade-impact-Covid-19-pandemic