Status: 07.02.2022 1:05 p.m
Despite the global pandemic and congestion in container shipping, world trade is picking up speed. It is now even above the level before the Corona crisis. However, there are signs of problems in China.
According to a study by the IfW Institute, world trade will increase at the beginning of 2022. Regardless of the aggravated Corona situation, traffic jams in container shipping and global delivery bottlenecks, world trade gained momentum in January compared to the previous month and is now even exceeding the pre-crisis level, the Kiel economists announced today.
The traffic jams on the international routes of container shipping continue to impede the supply of goods and raw materials worldwide. “Around eleven percent of all goods shipped worldwide are currently stuck in traffic jams,” according to the IfW. In the Red Sea, the most important trade route between Europe and Asia, there are currently around eleven percent fewer goods than usual. Against this background, IfW economist Vincent Stamer interprets the ongoing supply bottlenecks as “an expression of an extremely rapid increase in demand that supply cannot keep up with”.
problems in China
According to Stamer, the omicron wave has so far primarily posed a threat to China in terms of trade in goods. But that could change: “It is to be feared that delays in China’s container handling would also affect Europe’s trade,” says Stamer. “The Chinese New Year celebrations and the hosting of the Olympic Games are a test for China to ensure that the pandemic situation and thus the economic outlook do not deteriorate.”
The Chinese authorities are already fighting smaller strands of infection with tough measures. In the past few weeks, they have imposed lockdowns in several cities across the country. Among other things, this led to production stops in factories, logistical delays and a slump in domestic consumption.
German industry missed pre-crisis level
Meanwhile, German industry continues to struggle with material shortages that are affecting production and value creation. Industry, construction and energy suppliers together produced 3.0 percent more than in the first Corona year 2020, according to the Federal Statistical Office. However, production was still 5.5 percent below the level of the pre-crisis year 2019. According to the statisticians, production even shrank by 0.3 percent compared to the previous month.
According to the Kiel Institute for the World Economy (IfW), industrial production alone was around twelve percent below the level that would actually have been possible given the high level of incoming orders. “This corresponds to lost added value of around 70 billion euros,” said Nils Jannsen, head of the IfW economy.
Dynamics in the coming months?
“The delivery bottlenecks rarely allow the processing of the actually plentiful orders smoothly,” said DIHK economic expert Jupp Zenzen. “That and the loss of staff due to the Omikron wave are dampening expectations of a rapid economic recovery this year.”
The Federal Ministry of Economics is more optimistic and refers to surveys that signaled a gradual resolution of the delivery bottlenecks. “In combination with the high order backlog of the companies, this indicates a dynamic development of the industrial economy in the coming months,” said the ministry.