Archive:Impact of COVID-19 on international trade by main partners

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Data extracted in August 2020.

No planned update.

Highlights

EU-27 imports from Russia and Norway fell most during the first semester of 2020 compared to the first semester of 2019

EU-27 exports to India and the United Kingdom fell most during the first semester of 2020 compared to the first semester of 2019

To help prevent the spread of the COVID-19 pandemic, countries around the world have taken a variety of restrictive measures, which have negatively affected international trade in goods. This article is part of an online publication containing articles on the Impact of COVID-19 on international trade in goods statistics. In this article, we present the impact on trade with the EU's ten main partners. To ensure comparability over time we use seasonally and working-day adjusted data.

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Comparison with the previous year

Figure 1 shows the growth rates of trade for the main partners of the EU-27, comparing the first semester of 2020 with the first semester of 2019. Among the main partners, the largest drop for imports was for Russia and Norway from which the EU imports large quantities of energy products. The largest drop for exports was with India and the United Kingdom. The only increases were in exports to South Korea and imports from China and Switzerland.

Figure 1: Growth rates of extra EU-27 trade in goods by main partner (first semester 2019 - first semster 2020)
Source: Eurostat (ext_st_27_2020sitc)

Table 1 compares the growth rates for imports in the last six months to the same month of the previous year. It shows that the worst month for China was March. For Norway, Turkey and South Korea it was April while for the other main partners it was May. After March imports from China grew, possibly helped by reduced imports from other countries. The United Kingdom and the United States were among a group of seven main partners from which imports in June 2020 were more than 10 % lower than in June 2019. Switzerland (-3.2) and Japan (-9.4) did somewhat better while imports from China increased by 23 %.

Table 1: Growth rates of extra EU-27 imports in goods by main partner (% change compared to same month previous year)
Source: Eurostat (ext_st_27_2020sitc)

Table 2 compares the growth rates for exports in the last six months to the same month of the previous year. In the first three months, drops of more than 10 % occur for United Kingdom (March to May) and India (only March) while exports to other partners suffer less. In April (with the exception of China) and May all main partners have drop of more than 10 %. In April India, the United Kingdom, the United States, Norway, South Korea and Switzerland have their worst month. For Turkey, Russia, Japan and China this happens one month later. However, in June 2020 exports to China, South Korea, Norway and Switzerland are increasing compared to June 2019

Table 2: Growth rates of extra EU-27 exports in goods by main partner (% change compared to same month previous year)
Source: Eurostat (ext_st_27_2020sitc)

Figure 2: EU-27 imports for main partners, first semesters 2019 and 2020 (EUR billion)
Source: Eurostat (ext_st_27_2020sitc)

Figure 3: EU-27 exports for main partners, first semesters 2019 and 2020 (EUR billion)
Source: Eurostat (ext_st_27_2020sitc)

Month to month comparison

In the month to month comparison for imports, most main partners have their worst month in April. China ( 2 months earlier) and the United Kingdom (1 month earlier) are ahead while India and the United States follow in May. In May 2020 imports from Switzerland, China and Turkey grow compared to April 2020. While from May 2020 to June 2020 imports from all countries with the exception of China where there is a 1 % drop.

Table 3: Growth rates of extra EU-27 imports in goods by main partner (% change compared to the previous month)
Source: Eurostat (ext_st_27_2020sitc)

For exports April is the worst month for all main partners except China which is one month ahead. In April EU exports are falling to all main partners except China while in May the exact opposite happens. India is the only partner with two consecutive drops of more than 10 %, namely in March and April. In contrast exports to Japan and China never drop more than 10 %. In June exports to all main partners are increasing, most notably to India (+ 47 %), Turkey (+ 30 %) and the United Kingdom (+ 23 %).

Table 4: Growth rates of extra EU-27 exports in goods by main partner (% change compared to the previous month)
Source: Eurostat (ext_st_27_2020sitc)

Figure 4: EU-27 trade with four largest partners, January 2019 - June 2020 (EUR billion)
Source: Eurostat (ext_st_27_2020sitc)

Source data for tables and graphs

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Data sources

EU data is taken from Eurostat's COMEXT database. COMEXT is the reference database for international trade in goods. It provides access not only to both recent and historical data from the EU main partners but also to statistics of a significant number of third countries. International trade aggregated and detailed statistics disseminated via the Eurostat website are compiled from COMEXT data according to a monthly process.

Data are collected by the competent national authorities of the main partners and compiled according to a harmonised methodology established by EU regulations before transmission to Eurostat. For extra-EU trade, the statistical information is mainly provided by the traders on the basis of customs declarations.

EU data are compiled according to Community guidelines and may, therefore, differ from national data published by the main partners. Statistics on extra-EU trade are calculated as the sum of trade of each of the 27 EU main partners with countries outside the EU. In other words, the EU is considered as a single trading entity and trade flows are measured into and out of the area, but not within it.

The EU-27 data reflect the political change in the EU composition. Therefore, the United Kingdom is considered as an extra-EU partner country for the EU-27. However, the United Kingdom is still part of the internal market until the end of the transitory period, meaning that data on trade with the United Kingdom are still based on statistical concepts applicable to trade between the EU main partners. As a consequence, while imports from any other extra-EU-27 trade partner are grouped by country of origin, the United Kingdom data reflect country of consignment. In practice this means that the goods imported by the EU-27 from the United Kingdom were physically transported from the United Kingdom but part of these goods could have been of other origin than the United Kingdom. For this reason data on trade with the United Kingdom are not fully comparable with data on trade with other extra-EU-27 trade partners.

Methodology

In this article some products are classified as COVID-19 related products. They are compared over time and across countries, and also to products in the same chapter of the Harmonised System (HS) product classification, i.e. they are compared to other similar products that are however not directly used in response to the COVID-19 pandemic. It should be noted that most COVID-19 related products cannot be precisely identified and they are grouped together with products not specific to COVID-19. Nevertheless, some trends can be observed.

According to the EU concepts and definitions, extra-EU trade statistics (trade between EU main partners and non-EU countries) do not record exchanges involving goods in transit, placed in a customs warehouse or given temporary admission (for trade fairs, temporary exhibitions, tests, etc.). This is known as ‘special trade’. The partner is the country of final destination of the goods for exports and the country of origin for imports.

Unit of measure

Trade values are expressed in millions or billions (10⁹) of euros. They correspond to the statistical value, i.e. to the amount which would be invoiced in the event of sale or purchase at the national border of the reporting country. It is called a FOB value (free on board) for exports and a CIF value (cost, insurance, freight) for imports.

Context

Trade is an important indicator of Europe’s prosperity and place in the world. The bloc is deeply integrated into global markets both for the products it sources and the exports it sells. The EU trade policy is an important element of the external dimension of the ‘Europe 2020 strategy for smart, sustainable and inclusive growth’ and is one of the main pillars of the EU’s relations with the rest of the world.

Because the 27 EU main partners share a single market and a single external border, they also have a single trade policy. EU main partners speak and negotiate collectively, both in the World Trade Organization, where the rules of international trade are agreed and enforced, and with individual trading partners. This common policy enables them to speak with one voice in trade negotiations, maximising their impact in such negotiations. This is even more important in a globalised world in which economies tend to cluster together in regional groups.

The openness of the EU’s trade regime has meant that the EU is the biggest player on the global trading scene and remains a good region to do business with. Thanks to the ease of modern transport and communications, it is now easier to produce, buy and sell goods around the world which gives European companies of every size the potential to trade outside Europe.