How COVID-19 has Affected Trade, in 8 Charts

11/06/2020

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César A. Hidalgo | World Economic Forum

In May 2020, China exported more face masks than any other product. According to China’s customs data, the Asian economy exported more than $14 billion of “not elsewhere classified made up textiles”. This is a few billion more than China’s best monthly exports on its traditionally strongest products: portable computers ($9.9 billion in July 2020) or cellphones ($8.3 billion in July 2020).

The fact that COVID-19 is affecting international trade patterns should not surprise anyone. But understanding exactly how requires looking into fine-grained data. At the Observatory of Economic Complexity (OEC), we collect data from dozens of custom agencies to help facilitate that view. Today, we are releasing a free online tool that allows people to visualize changes in the trade trajectories of dozens of countries and thousands of products.

Let’s begin by looking at total monthly exports for the world’s largest export economies: China, the US and Germany. China experienced a sharp fall in exports during February, but recovered quickly and was back to normal by March. The US and Germany, however, experienced a dip in exports in April, but did not recover as quickly:

exports economic data
How the pandemic hit exports
Image: OEC data

We can explore these differences more deeply by comparing the exports of a particular month in 2020 with the same month in 2019. This shows that in July this year, China was up by $40 billion in exports on the same month last year. The same calculation shows the US was still down in July by about $20 billion. This exercise also shows that the decline of US exports in May was comparable to that of China in February (about $50 billion). February is usually the slowest export month for China (it coincides with their New Year), so part of their dip in exports is explained by seasonal variation, which is accounted for in the year-over-year indicator:

exports year on year
Seasonal variations play a role in the year-on-year data

Digging deeper into the data shows us that COVID-19 has been bad news for some markets but good news for others. Brazil has seen a bounty in its exports of agricultural products such as frozen beef and soybeans. The former jumped from $464 million a month in April 2020 to $639 million in May. Brazil’s soybean monthly exports grew even more sharply, by more than $1 billion in a year-on-year basis in April 2020:

beef exports
A boom for Brazilian beef
economy exports soybeans
Brazilian soybeans also surged

Other markets, however, haven’t been as lucky. Let’s look at transportation. Car exports were down by billions in Spain, Canada, Japan, and the US. US delivery truck exports also went down by more than $1 billion in April and May, and reached normal levels only in July. US aircraft part exports also declined sharply, by more than $6 billion in May and June. Bicycle exports (mostly from China), however, followed a different pattern, declining sharply in February and March but rebounding with fury during the summer, up more than 50% year-over-year during June and July:

car exports
Car exports were down by billions
Exports of trucks also fell sharply
Bikes bounced back

Garment exports also declined sharply in 2020. Both, Chinese apparel exports and footwear exports declined by more than $1 billion during February, April and May, compared to the same months in 2019. Yet, this decline may have been compensated by the stellar performance of a highly related product (“other made up textiles” – aka face masks), which can also be produced by apparel and footwear manufacturers:

Together, these charts show us the power of using online tools to explore recent trends in international trade. By connecting tools like this one directly to international trade sources, we move one step closer to understanding the effects of COVID-19 on the global economy.

To explore more trends, visit oec.world/en/trend-explore

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César A. Hidalgo, ANITI Chair, University of Toulouse; Honorary Professor, University of Manchester; Visiting Professor, Harvard University; Founder & CEO, Datawheel