Global trade in January surpassed pre-pandemic level: Report

By Ovunc Kutlu

ANKARA (AA) – Global trade in January surpassed the pre-pandemic level, but the omicron variant poses a threat to the Chinese economy, according to a research report published on Monday.

Global trade increased 2.4% in January from the previous month, said the report by the Kiel Institute for the World Economy.

It is currently 7% above its previous peak recorded in August 2018, before the COVID-19 crisis, it added.

The Kiel Institute for the World Economy is a German independent and non-profit economic research institute and think tank.

While Germany's exports rose 1.2% in January, its imports increased 0.8%.

Exports of the EU and the US gained 0.6% and 3.6% last month, respectively, but their imports declined 0.1% and 1.6%.

"Currently, around 11% of all goods shipped worldwide are stuck in traffic jams, and around 11% fewer goods than usual are being moved in the Red Sea," the report noted.

The research institute stressed that the omicron variant of coronavirus has been limiting China's trade figures, and the country's 2021 upward trade trend has been broken.

While China's imports dropped 2.8% month-on-month in January, its exports declined 0.2%, it said.

"Beijing's tough zero-COVID policy is a threat to the economy there. There is great risk that this will also affect Europe's trade through further delays in port operations," Vincent Stamer, head of Kiel trade indicator, said in a statement.

"However, the Chinese New Year and especially the hosting of the Olympic Games are a test for the Chinese economy that the pandemic and therefore also the economic situation does not worsen," he added.

Stamer stated that the current supply bottlenecks are a result of a rapid increase in demand that supply cannot keep up with.