KAS Japan Weekly COVID-19 Updates

von Cristita Marie Perez

COVID-19 and Trade Imbalances

The IMF’s latest External Sector Report finds that there is limited reduction in global current account deficits and surpluses despite a slow down in global trade.


Key messages include:

  1. The forecast shows a more modest adjustment in 2020 compared to the 2009 global financial crisis but the situation varies across countries. Economies dependent on the hardest hit sectors such as tourism and oil and remittance-dependent countries may see a decline in their current account balances exceeding 2 percent of GDP. 
  2. The outlook remains #uncertain as the risks of new waves of the pandemic, capital flow reversals, and a further decline in global trade persist. 
  3. Tariffs and nontariff barriers to trade should be avoided as these are costly for trade and growth.



Cristita Marie Perez

Cristita Marie Perez KAS

Managerin des Regionalprogramms Soziale Ordnungspolitik Asien (SOPAS) +81 3 6426 5041