26 June 2020
Independent economist Rebecca Harding shares three reasons why she believes trade will never be quite the same again
Remember January 2020?
That was when we thought the trade war had turned into a truce. We had mildly positive expectations for global economic growth based on IMF forecasts. We thought that financial markets would continue their bull run with the only risks the same as those that had been evident throughout the period since the Global Financial Crisis: US dollar denominated debt in emerging markets, the strength of the US dollar, the sustained effects of extraordinary monetary policy and the speed at which trade and growth would recover from the China-US trade spat.
Now, according to the usually conservative IMF and the optimistic World Trade Organisation (WTO), global GDP growth this year will fall by more than 7% (against a previous forecast for growth of 3.5%) and trade will fall by anything between 13% and 32%. Up to 195 million jobs could be lost worldwide.1