As this publication goes to press, the World Trade Organization has issued a warning that Covid-19 could result in global trade volumes declining by as much as 32% this year, depending on how deep the initial shock is and whether the recovery can start to take shape in the second half of this year. The numbers, as director general Roberto Azevêdo says, are “ugly”, with “inevitable” comparisons to the financial crisis of 2008 and the Great Depression of the 1930s.
Governments, development finance institutions and commercial banks the world over have unveiled a variety of financial support measures, including state-backed guarantees and access to liquidity packages, to meet the demands of the crisis triggered by the pandemic.
These measures have largely been welcomed by the trade community, although, as they’re being rolled out, we’re now also starting to see questions arise as to whether or not these initiatives are sufficient, exactly how they will be spent, and who’s eligible for them. There are concerns too about the lack of harmonisation and co-ordination of these approaches across regions. This may make them difficult for financial institutions to navigate and could prove a costly administrative burden for companies that need to manage conflicting legal schemes.
You will find that a great deal of GTR’s news stories, published online and in these pages, are now dedicated to investigating the impact of coronavirus on businesses, supply chains and finances, the steps that have been introduced to address these effects, and the trends that are evolving, such as the accelerated need for digital solutions to virtually ink trade finance deals and documents.