Question

Critically evaluate the impacts of COVID- 19 on international trade and the World Trade Organization (WTO) roles in handling this pandemic. The student is required to use ONE (1) country either developing or developed as an example in writing the impacts. The student needs to examine the impacts of the pandemic in terms of the good and services sectors (support by the latest data) and the roles of WTO.

Answer 1

China has suffered severe impact on its huge exports because of the pandemic, as in January and February, its trade of goods and services was down significantly with its trade in deficit (USD 3bn), it was importing more then it was exporting. As several companies were shut in China and this impacted its exports. However in recent months China's trade surplus has increased (USD 45bn in April 2020), partially because of the lockdown measures seen in other countries. But the pandemic is likely to dent China's trade growth going ahead as several of the countries which had set-up factories in China are now shifting it to Vietnam and Bangladesh. Plus countries are also skeptical in trading with China because of less transparency portrayed by China in terms of the virus outbreak. Thus going ahead, with US and China at loggerheads, it will prove increasingly difficult for China to sell goods in the world market.

World Trade Organisation has resolved to keep countries working together and it states that keeping the markets open after the pandemic will ensure recovery takes place rapidly. It is looking at ecommerce as a platform to spur trade growth, and also helping bridge the digital divide across countries. It wants to ensure that there is multilateral trading system, in order to ensure health standards are maintained in the same way worldwide and help with global trade during and after the pandemic starts to decline.