According to preliminary estimates by the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), in 2020 world trade as a whole decreased by 14.5%. Against this background, its 2% drop in the ESCAP countries promises more promising prospects.
The region's share in global merchandise exports and imports is expected to rise to a record high in 2020, to 41.8% and 38.2%, respectively, up from 39.9% and 36.9% a year earlier.
However, trade in the region varies significantly from country to country. Thus, the sharpest drop in trade - exports and imports - occurred in South and Southwest Asia. And the countries of North and Central Asia had the worst export performance - it fell by 24.4 percent, mainly due to a sharp drop in oil prices.
ESCAP experts believe that the prospects for a full recovery of trade in the region are very "dim" due to unfavorable macroeconomic conditions, high unemployment, huge debts and deflation. Smaller countries in the region face additional challenges stemming from declining tourism and reduced remittances from migrants.
ESCAP Executive Secretary Armida Salcia Alisjabana fears the devastating impact of COVID-19 will put millions of people in the region back in poverty.
"I urge the countries of the region to develop a better set of trade rules that will keep exports and imports afloat during the crisis and will stimulate a sustainable economic recovery ..." - stressed Armida Salcia Alisjabana.
ESCAP notes that along with trade, the volume of foreign direct investment has also decreased in the region. In the first three quarters of 2020, they fell by 40 percent compared to the same period in 2019.
Experts believe that in 2021 investment flows will remain below pre-crisis levels. And the prospects for their recovery in the future will largely depend on the duration of the health crisis, the effectiveness of the policy to stimulate investment and the socio-economic consequences of the pandemic.
Founded in 1947, ESCAP is the largest of the five UN regional commissions - both in terms of geographic scope and population - its membership spans from the Pacific island state of Kiribati in the east to Turkey in the west, Russia in the north and New Zealand in the south. The Commission consists of 53 countries.