The conflict in Ukraine and Covid lockdowns in China have depressed global goods trade in the first half of 2022, according to the latest WTO Goods Trade Barometer.
Early optimism dampened
Optimism in February’s Barometer suggested that trade might have been approaching a turning point, but the latest outlook indicates this may have been short term.
The current reading of 99.0 remains slightly below the baseline value of 100 for the index suggesting continued slow growth in merchandise trade, reports WTO.
Food and energy costs
War in Ukraine, which started in late February, triggered sharp rises in food and energy prices, leading to lower economic growth.
China’s imposition of major Covid lockdowns, including at Shanghai port, has further disrupted trade and production.
According to the Economic Times, the barometer’s component indices are close to or above their baseline value of 100, including export orders (101.2), automotive products (101.5), air freight (99.9), electronic components (103.8), and raw materials (99.5).
Container shipping remains firmly below trend (95.0) due to “persistent port backlogs,” Bloomberg reports.
The WTO said its latest barometer is broadly consistent with the trade body’s April forecast of a 3% increase in global merchandise volumes in 2022, down from the 4.7% growth predicted last October.