According to calculations by the Kiel Institute for the World Economy (IfW), the war in Eastern Europe caused world trade to collapse within a few days. For February, the IfW economists assume a minus of 5.6 percent. “This is the biggest slump since the outbreak of the Corona crisis in spring 2020. The recovery trend of the last few months has thus been interrupted,” the institute reported on Monday.
“Although the conflict between Russia and Ukraine only escalated in the last week of February, uncertainty, sanctions and increased product controls to comply with the sanctions already seem to be having a lasting impact on trade,” said IfW economist Vincent Stamer. “A weaker month was already becoming apparent in mid-February, and the sanctions against Russia are reinforcing this trend.”
After the damper in German foreign trade in January, the IfW also expects negative signs for February. “In Germany, imports are likely to drop unusually sharply compared to January (-3.9 percent), and exports are also likely to fall (-3.8 percent),” writes the institute. “For the EU, there are also signs of declines in imports (-1.6 percent) and exports (-2.8 percent).”
For Russia itself, IfW calculations show a sharp drop in exports of 11.8 percent compared to January. In February alone, 17 percent fewer goods were shipped in St. Petersburg, the largest container port. The IfW expects a moderate decline of 1.6 percent in Russian imports.
“The mixed situation in Russian trade is confusing, but the sanctions imposed by the West are clearly having an effect. Russian exporters are likely to hold back more goods simply because of uncertainty about payment,” said Stamer. “Although major shipping companies have announced that they are stopping their deliveries to Russia, this only affects new bookings. Old bookings are currently still being shipped to Russia as scheduled, provided they do not violate sanctions.” (dpa)