Trade Measures Enacted by Countries Due to the COVID-19 Pandemic

Soon after the World Health Organization (WHO) declared the COVID-19 pandemic on 11 March 2020, evident signs emerged that the global economy would suffer an unprecedented decline. The International Monetary Fund’s (IMF) projections in April showed that in 2020, global output would decline by 3%, but two months later, the projected decline was revised downwards by 2 percentage points. For the first half of the year, the Organisation for Economic Co-operation and Development’s (OECD) projections were far worse—a 13% decline in the global gross domestic product (GDP). The decline in the global economic growth in 2020 was around -3.2%, and the decline in global trade was around 5.3%. The IMF’s projections in July 2021 showed that the world economy will grow at 6% in 2021 and 4.9% in 2022 (IMF 2021a). The WTO has predicted that the global GDP would grow by 5.3% in 2021 and 4.1% in 2022.

Historically, economic downturns have caused considerable disruptions, especially because protectionist sentiments have become dominant in most economies (Bown 2011; Baldwin and Evenett 2020; Hoekman 2020; Nicita and Olarreaga 2020). To protect their domestic producers, countries have adop­ted many policies for restric­ting imports, thus discriminating against foreign producers. Short-sighted protectionist policies during the Great Depression (1930s) resulted in the deepening of the economic crisis, and there were justified concerns that a similar situation could emerge in the COVID-19-stricken world.