Coronavirus outbreak is at the centre of our daily concerns. But what about the economy? What are the impacts on trade and businesses in Belgium? Euler Hermes assesses the situation.
After the U.S.-China trade feud slashed global trade growth to its slowest pace since 2009 last year (+1.2% in volume terms), Euler Hermes, global leader in Trade Credit Insurance, expects the Covid- 19 outbreak to act as a major trade barrier in 2020.
According to Euler Hermes' calculations, losses in trade in goods and services will amount to USD320 billion per quarter of trade disruption. This shock is already visible in the first trade indicators that signal a recession in world trade volumes, both in the first quarter of 2020 (-2.5% q/q annualized) and in the second quarter (-1%). The sectors most affected are chemicals, transport, automotive, textiles and electronics. Apart from China and Italy, the most affected economies are Taiwan, South Korea, the Netherlands, Hungary and Indonesia.
And what about Belgium?
Belgium has an open and export-oriented economy. The impact on trade and on Belgian companies will be particularly significant.
Ed Goos, CEO of Euler Hermes BeLux: