UNCTAD’s new Global Trade Update published on 21 October 2020

Global trade shows frail recovery in third quarter, but outlook remains uncertain

UNCTAD estimates show a 5% drop in world trade in the third quarter of 2020 compared to 2019, an improvement from the 19% decline in the second quarter but insufficient to pull trade out of the red.

Global trade recorded a 5% drop in the third quarter of 2020 compared with the same period last year, according UNCTAD’s new Global Trade Update published on 21 October. This marks an improvement on the 19% year-on-year plunge recorded in the second quarter, and UNCTAD expects the frail recovery to continue in the fourth quarter, with a preliminary forecast of -3% compared with the last quarter of 2019. Depending on how the COVID-19 pandemic evolves in the winter months, the UN trade and development body expects the value of global trade to contract by 7% to 9% with respect to 2019.

Although a 7% to 9% decrease would be a negative finish for the year. UNCTAD’s Secretary-General Mukhisa Kituyi highlighted that it’s a much more positive result than was expected in June, when UNCTAD had projected a 20% year-on-year drop for 2020. Since then, trade trends have improved primarily thanks in part to the earlier-than-expected resumption of economic activities in Europe and east Asia.

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