World News

WTO says services trade growth slowing as coronavirus strikes

BRUSSELS (Reuters) – Growth of global trade in services has weakened at the start of 2020 as the coronavirus hits the global economy, notably air travel and container shipping, the World Trade Organization (WTO) said on Wednesday.

The Geneva-based trade body said its services trade indicator fell to 96.8 from the 98.4 reading reported in September. Readings of less than 100 indicate trade growth below medium-term trends.

The WTO said the new figure did not fully take into account the economic impact of the new coronavirus and could decline further in the coming months.

The largest declines were for passenger transport and shipping, with financial and IT services also below trend, although construction was broadly unchanged.

World services trade growth steadily slipped through 2019 to 2.8% in the third quarter from 4.7% in the first, the WTO said. Global merchandise trade fell by 0.2% year-on-year in the third quarter, the WTO said last month.

The WTO services trade barometer is a composite of data on purchasing manager indices, financial transactions, IT services, passenger flights, container shipping and building permits.

It is designed to identify turning points and gauge momentum in global trade growth rather than to provide a specific short-term forecast.

(Reporting by Philip Blenkinsop; Editing by Mark Potter)