Trade: A two-act scenario
World trade in goods is set to plummet in 2020, with the drop estimated by the WTO at 18.5% compared to 2019. Countries less reliant on global trade were less exposed to the immediate effects of the global contraction. Inversely, as trade levels are restored, countries more open to trade are likely to recover faster, as they can benefit from their trading partners’ recovery. Given that the virus spread to countries over a period of months, and that the economic impact differs for each country, each economy’s recovery will largely depend on the timing and the pace of recovery in their main export markets.
Countries that have traditionally exported to markets where the CERI shows strong recovery capacity are likely to experience more positive feedback loops through their trade linkages. The figure above shows this for selected countries. Based on this data, Brazil’s recovery is likely to be less driven by trade than China’s, because over half of Brazil’s exports are to countries with limited recovery capacity, where it will take longer for demand to pick up. The crisis may provide an opportunity to step up efforts and channel some of the stimulus package to help companies diversify export markets and thus strengthen future resilience.
Explore how countries top trading partners perform on CERI
The interactive tool below allows you to explore if your country is likely to experience positive feedback loops from your trading partners. Each dot corresponds to a country and the color of the dot shows the country's performance on the CERI (see legend). The lines represent main trade linkages, the thicker the line, the stronger the trade relationship. The arrow shows the direction of the trade relation, always pointing towards the export markets. The more links a country has, the more important role this country plays in international trade.