As a result of the war in Ukraine, global trade growth could be half as much as expected by 2022. This is according to an analysis published today by the World Trade Organization (WTO).
According to the WTO, Russia’s invasion of Ukraine would plunge global economic growth to 3.1 to 3.7 percent, while global trade would fall between 2.4 and 3 percent. In October, the organization had forecast a trade growth of 4.7 percent.
“The suffering and devastation are felt most strongly by the Ukrainian population, but the costs in terms of reduced trade and production are likely to be felt by people worldwide, through higher food and energy prices and reduced availability of goods from Russia and Ukraine.” , says the analysis.
Although the share of Russian and Ukrainian products in total world trade is relatively small, both countries are important suppliers of food and energy. For example, about 25 percent of global grain, 15 percent of barley and 45 percent of all sunflower products in 2019 came from both countries. Russia alone accounted for 9.4 percent of global fuel trade, of which 20 percent of all natural gas exports.
Poorer countries are more at risk from the war, as they typically spend a higher share of their income on food compared to richer countries. “That could have an impact on political stability.”
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