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Trade Wars Threaten Post-pandemic Global Economic Recovery

y Paul Antonopoulos

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The COVID-19 pandemic did not stop U.S. protectionism and its trade disputes with the rest of the world, especially with China and the European Union. In actual fact, it deepened the conflict. This behaviour anticipates very complicated post-pandemic international trade, which can exacerbate the protectionist tendencies of developed economies and, therefore, affect the global recovery.

The World Trade Organization (WTO) now estimates a drop of up to 18.5% in the exchange of goods and services internationally for this year. Instead of a framework for cooperation and coordination to address the global crisis caused by COVID-19, the U.S. has complicated cooperation between powers.

World trade fell sharply in the first half of the year, due to the impact of the pandemic on the world economy. WTO economists estimate that the volume of trade will fall sharply in 2020, but it is unlikely it will be the worst-case scenario forecast made in April, which expected a contraction of 32%. According to WTO statistics, the volume of merchandise trade declined 3% in the first quarter. Initial estimates for the second quarter point to a year-on-year decline of 18.5%.

“The collapse in trade we are currently witnessing reaches.....