Credit rating agency Moody’s on late Thursday projected that global trade will continue recovering this year in the shadow of COVID-19.
Global trade is expected to grow 7-9% in 2021, following a 9% contraction in 2020, Moody's said in a report, while highlighting that its volume will not reach the pre-pandemic levels before 2022.
The report said that continued vaccination rollout and policy measures will support the economic recovery, boosting manufacturing activity and trade flows. But the risk of new virus variants, a resurgence of infections and new restrictions persist.
The rating agency warned that geopolitical tensions, new sanctions and export controls, and domestic policy focus will complicate trade negotiations.
Supply-chain considerations will drive shifts in business strategies in strategic sectors, it noted.
While coronavirus-driven supply chain disruptions will subside as the global economy recovers, governments’ “buy national” strategies will add to disruptions in supply chains for medical supplies and strategic sectors.
"Companies will focus on multi-supplier, multi-source and reshoring strategies," it explained.