FOREIGN TRADE STRENGTH OF COUNTRIES UNDER THE COVID-19 PANDEMIC

Abstract

Abstract. In 2020 the COVID-19 pandemic became the major event affecting the global economy. Both supply- and demand-driven recession and changes in consumption and investment behaviour became a new reality. The purpose of the paper is to estimate foreign trade strength and vulnerability of countries under the shrinking global demand for specific groups of goods and services as a result of the COVID-19 pandemic and the measures to contain it. The proposed foreign trade strength index under pandemic is based on exports of pharmaceutical products, medical equipment, food, IT and audiovisual goods and services etc. (+); tourism and transport services, oil, ores and metals, transport vehicles and most other types of machinery etc. (-); and imports of medical and related products (-) in comparison to a country’s GDP. The ranking is provided for the largest 100 economies. 90% of the countries have absolute trade vulnerability under the pandemic. There are 3 types of economies with relatively better trade soundness: exporters of medical products and ICT services (Ireland and Switzerland), food exporters and closed economies. The most vulnerable economies include small island countries which depend on
tourism services exports, oil exporting countries and exporters of machines and equipment. Ukraine ranks 38th and has a standardized value of the index +0.4 mainly because of its food exports which help offsets the weakness due to the metal exports. Vulnerability of large economies is caused by their merchandise export structure, while vulnerability of small economies is due to their services export structure.
Key words: foreign trade, economic resilience, demand for goods and services, dependence on global markets, pandemic, quarantine measures.