BRUSSELS — World trade in goods is set to slump at a rate not seen since the global financial crisis in 2009, with estimates becoming increasingly gloomy over the past weeks, the United Nations Conference on Trade and Development (UNCTAD) said on Wednesday.

Merchandise trade is seen down 3.0 percent in the first quarter from the final three months of 2019 and by a further 26.9 percent in the second quarter, UNCTAD said. Year-on-year, these figures would be falls of 3.3 percent and 29.0 percent respectively.

There were falls of a similar magnitude in 2009 during the global financial crisis, although the decline was not as steep as in 2020. At that time, global trade rebounded just as quickly, in line with global economic recovery.

Steve MacFeely, Chief of statistics, United Nations Conference on Trade and Development

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“There were falls of a similar magnitude in 2009 during the global financial crisis, although the decline was not as steep as in 2020. At that time, global trade rebounded just as quickly, in line with global economic recovery,” said UNCTAD’s chief of statistics Steve MacFeely.

“At this moment, the shape of the recovery is still not clear, it will depend on how fast the economies return to positive growth and their demand for traded goods increases once again,” he continued.

UNCTAD said its view of the first quarter had steadily worsened since March 24, when it predicted modest growth of trade in value terms of about 1 percent.

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It said that the drop in global trade is accompanied by marked decreases in commodity prices, which have fallen precipitously since December last year.

UNCTAD's free market commodity price index (FMCPI), which measures the price movements of primary commodities exported by developing economies, lost 20.4 percent of its value in March, a record in the history of the index. By comparison, during the global financial crisis of  2008, the maximum month-on-month decrease was 18.6 percent.   

The report said plummeting fuel prices were the main driver of the steep decline, which plunged 33.2 percent in March, while prices of minerals, ores, metals, food and agricultural raw materials tumbled by less than 4 percent.   

The UNCTAD warned that the duration and overall strength of the current downward trend in commodity prices and global trade remain uncertain.

With Xinhua inputs