Russia’s war in Ukraine did not dent global trade in 2022 as badly as feared, the World Trade Organization said Thursday — and Russia’s export values even surged.
A year on since the full-scale invasion, the WTO concluded that trade had proved “remarkably resilient”, with importing countries affected by the conflict finding alternative sources of supply.
A report looking into the war’s impact on global trade and development estimated that trade growth in 2022 was above the WTO forecast of three% issued last April in response to the invasion — and substantially higher than its estimates for more pessimistic scenarios.
Detailed figures will be published this April.
For the most exposed countries, trade had kept afloat, the WTO said, as had trade in products significantly affected by the war — such as wheat, maize, sunflower products, fertiliser and fuels.
“Global trade has held up well in the face of the war in Ukraine,” the WTO’s chief economist Ralph Ossa said.
“Despite the devastation we have seen one year on, trade flows remained open… Sharply higher food prices and supply shortages have not materialised thanks to the openness of the multilateral trading system”.
The effects on the warring countries’ exports contrast starkly.
While Ukrainian exports collapsed by 30% in value terms last year, Russian exports expanded by 15.6% in value terms, almost entirely due to an increase in prices for fuels, fertilisers and cereals.
– Russian exports to China, India up –
Cereal exports from Ukraine — central to the food security of many African countries — dropped by 14.9%, forcing nations to adjust their sourcing, said the WTO.
The report cited Ethiopia, which had relied on Russia and Ukraine for 45% of its wheat, turning to Argentina and the United States instead.
Meanwhile, countries neighbouring the conflict such as Hungary and Poland increased their imports from Ukraine, mainly for agricultural products, said Ossa.
While Russia’s exports expanded by value, WTO estimates suggest that its volume may have declined.
“Trade flows are sharply down for industrial goods such as motor vehicles, pharmaceuticals or aircraft, where sanctions are more restrictive,” the Geneva-based organization said.
Ossa said Russian exports decreased the most to Britain and the United States, while increasing to China and India.
Prices for goods affected by the war rose less than had been expected after the invasion, the WTO said.
Maize prices increased by 24%, which although a substantial increase, was significantly lower than the gloomiest predictions.
Looking ahead, Ossa said: “Resilience will ultimately be best served by fostering deeper and more diverse international markets, anchored in open and predictable trade rules.”