UN agency sets 10-point plan for global trade logistics that’s 'under tremendous stress'

The United Nations trade agency UNCTAD on Wednesday (Apr 28) released a 10-point “action plan” for governments and international organisations to support the logistics of global trade that it says are “under tremendous stress” due to the continuing COVID-19 crisis.

The plan is in response to what UNCTAD says are “early evidence” that international trade is collapsing and threatening access to goods and critical supplies as countries adopt measures to contain the spread of COVID-19.

“The foundations for recovery from COVID-19 need to be set today. This includes ensuring transport services, ports and border agencies not only remain operational, but are also effectively strengthened to cope with the unprecedented challenges they face,” said UNCTAD.

The World Trade Organization (WTO) said in early April it expects world trade to fall by between 13% and 32% this year as the pandemic disrupts normal economic activity. It sees steeper drops in sectors with complex value chains, particularly electronics and automotive products.

UNCTAD had earlier in March said the downside scenario of the impact of the crisis is that the global GDP will see a $2 trillion shortfall with a $220 billion hit to developing countries, and called for coordinated policymaking to “ensure localised incidents do not impact global markets”.

Its 10-point plan released this week again calls for coordinated effort, and covers the need to keep ships moving, ports open and cross-border trade flowing while ensuring that border agencies can safely undertake necessary controls.

It stresses the need to facilitate trade and bolster transport of goods to avoid logistics obstacles that lead to shortages of necessary supplies.

To this point UNCTAD said that “protectionism may significantly exacerbate the global health crisis and delay a post-pandemic recovery.”

UNCTAD also picked up on this point in a separate statement focused on medical supplies. “In moves to secure national supplies, nearly 80 countries have imposed some form of restriction on the export of medical supplies,” said the UN agency.

“The tendency to act out of self-interest is a natural instinct, but one that must be tempered with comprehension of the larger picture. Disrupting vital global production chains using export restrictions will be detrimental to everyone in the long run."

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