World trade has recovered in the first quarter of 2021, with an increase of 10% compared to the same quarter in 2020 and an increase of 4% compared to the last quarter of last year, the United Nations Conference on Trade and Development (UNCTAD) reported on Wednesday (19.05.2021).
The report entitled “Global Trade Update"It indicates that this rebound is driven by trade in goods, but not services, which continue to suffer the effects of the health crisis.
Particularly, North American exports (United States, Mexico and Canada) rose 3% in the first quarter of this year, compared to the same period in 2020 and 1% compared to the first quarter of 2019. On the contrary, imports to this region rose 13% and 8%, in that same comparison, respectively.
In addition, UNCTAD indicated that The trade rebound in the first quarter of 2021 continued to be driven by the strong export performance of East Asian economies.
Thus, the region's foreign sales achieved a year-on-year growth of 33% in the first quarter of this year and an increase of 25% compared to the same period in 2019. Regarding its imports, it had increases of 23 and 19%, in that same order. Thus, in the first quarter of 2021, the value of trade in goods was higher than the pre-pandemic level, although trade in services remains substantially below the averages.
On the other hand, the report notes that the Trade recovery remains uneven, especially among developing countries.
In the first quarter of 2021, the value of merchandise imports and exports of developing countries was substantially higher compared to the first quarter of 2020 and the first quarter of 2019 (by about 16%).
According to UNCTAD, This upturn in trade occurred not only in COVID-19-related sectors such as pharmaceuticals, communications products and office equipment, but also in other sectors such as minerals and agri-food..
The UN General Assembly's main body expects the rebound to continue in the second quarter of 2021, with the value of global trade projected to reach $6.6 trillion. This is equivalent to a year-on-year increase of about 31% relative to the low point in 2020 and about 3% compared to pre-pandemic levels in 2019.
Outlook 2021
The report estimates that trade will continue to grow in 2021, particularly in the second half of the year, around a value of 16%.
Still, The positive outlook depends largely on the easing of pandemic constraints, a persistent positive trend in commodity prices, easing restrictions on protectionist trade policies, and favorable macroeconomic and fiscal conditions.
In light of this, some economies are expected to recover faster than others. In particular, The economies of China and the United States are estimated to be the main drivers of global growth during 2021.
This should also have positive effects on countries whose trade is relatively more integrated with them, for example, East Asian countries with China, and Canada and Mexico with the United States.
Among major economies, China's exports continue to register a strong increase not only relative to 2020 averages, but also relative to pre-pandemic levels. In contrast, Russia's exports remain below 2019 averages.
Finally, UNCTAD notes relocation and nearshoring trends to reduce uncertaintyand substantial in the operations of many global value chains and provide incentives to reduce segmentation and bring production closer to consumers.
“Furthermore, continued container shortages and rising freight rates could provide further impetus for relocation and nearshoring,” the report concludes.
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