Global trade set to grow 8% in 2021 after pandemic shock: WTO

WTO's new boss Ngozi Okonjo-Iweala says "he strong rebound in global trade since the middle of last year has helped soften the blow of the pandemic".
WTO's new boss Ngozi Okonjo-Iweala says "he strong rebound in global trade since the middle of last year has helped soften the blow of the pandemic". Fabrice COFFRINI POOL/AFP/File
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Geneva (AFP)

Global trade is set grow a bit faster this year than previously predicted, after shrinking by less than expected as the pandemic hit in 2020, the World Trade Organization said Wednesday.

"The strong rebound in global trade since the middle of last year has helped soften the blow of the pandemic for people, businesses, and economies," the WTO's new boss Ngozi Okonjo-Iweala said in a statement.

The global trade body's latest forecast predicted that global merchandise trade, by volume, would swell eight percent in 2021, up from its forecast last October that it would grow 7.2 percent this year.

This jump is expected after global trade shrank by 5.3 percent in 2020 -- less than had been previously feared.

A year ago, the WTO had cautioned that global trade could plummet by a third in 2020 due to the pandemic, but had already revised that estimate to an expected 9.2-percent drop.

"Prospects for a quick recovery in world trade have improved as merchandise trade expanded more rapidly than expected in the second half of last year," the Geneva-based organisation said.

- Equitable vaccine rollout -

While the rebound this year will be stronger than expected, growth is forecast to slow to 4.0 percent in 2022, it said, cautioning that the effects of the pandemic "will continue to be felt as this pace of expansion would still leave trade below its pre-pandemic trend."

And Okonjo-Iweala warned that the still-raging coronavirus pandemic could thwart any rebound in global trade.

"New waves of infection could easily undermine any hoped-for recovery," she told reporters, calling for vaccines against Covid-19 to be rolled out more quickly and more equitably.

"Rapid global and equitable vaccine rollout is the best stimulus plan we have for the strong and sustained economic recovery that we all need," she said.

However, "the possibility that many countries will be left behind as we emerge from the crisis is a major concern," the Nigerian former finance minister added.

"As long as large numbers of people and countries are excluded from sufficient vaccine access, it will stifle growth, and risk reversing the health and economic recovery worldwide," she warned.