The WTO highlights the resilience of world trade despite war in Ukraine

He world trade resisted the impact of the war in Ukraine better than expected, the World Trade Organization (WTO) said on Thursday, on the eve of the first anniversary of the start of the Russian invasion.

“World trade continued to show resilience and its results exceeded pessimistic forecasts for 2022, as the economies hard hit by the war in Ukraine found other sources of supply,” explains a note from the Geneva-based institution.

But the consequences of the war on exports from Russia and Ukraine are inverse, if they are calculated in value and not in volume, given that the former grew by 15.6% in 2022, while the Ukrainian ones sank by 30 percent. hundred.

According to the report, trade in 2022 was 3% higher than the estimate made by the WTO in April, less than two months after the start of the Russian invasion. The exact data will be published in April 2023.

The WTO had projected that the volume of exports it would grow between 2.4% and 3%, without excluding a contraction of 0.5% in the worst scenarios.

“If the worst-case scenarios did not materialize, that is because countries have been moderate in export restrictions, contrary to what happened at the time of the 2007-2009 world food crisis,” explained the chief economist at WTO, Ralph Ossa, at a press conference.

According to the WTO, the countries found alternatives to alleviate the scarcity of the products most affected by the war, such as wheat, corn, sunflower derivatives, fertilizers, fuels and palladium, used in the manufacture of car catalysts.

The prices of the most impacted products also increased less than expected, between 4.4% (palladium) and 24.2% (corn).

More Russian exports to China

According to the WTO, the war had a much more detrimental impact on Ukrainian exports than on Russian ones.

Between March and November 2022, Ukraine’s external billing sank 30% compared to the same period in 2021 in current prices, (without correction for inflationary effects), while Russia billed 15.6% more.

Ukrainian exports fell evenly to all of its trading partners, although some of its neighbors, such as Poland and Hungary, increased their orders for Ukrainian products.

Ukrainian cereal exports, essential for the food security of many African countries, collapsed by 14.9%, forcing those nations to diversify their sources of supply.

Ethiopia, which relied on 45% of wheat imports from Ukraine and Russia, increased its orders for the grain from the United States and Argentina.

Russia’s foreign turnover, on the other hand, increased, despite Western sanctions, due to the skyrocketing prices of many of its main export products, such as fuels, fertilizers and grains, the WTO explained.

Russian exports in volume could instead have decreased, due to lower demand for industrial goods, pharmaceuticals and aircraft, hit by sanctions.

By country, Russian exports to China and India increased, while those to the United Kingdom and the United States decreased considerably.