Since the coronavirus sent shocking waves across the global economy, many countries introduced a ‘state of emergency’. Spain implemented one of the strictest lockdowns in the world. Along with the lockdown, came travel bans, restrictions on trade and, loss of employment. The sudden COVID-19 pandemic ended a seven-year growth of Spain’s Economy. Trade between countries slowed down as the economy continued to decline. Spain’s primary trade partners include the USA, Germany, Italy and France. These countries account for 15.3% of Spain’s export trade. As a result of a growing pandemic, many industries temporarily closed down, affecting import and export in Spain.
The Spanish government announced a stop in production of all non-essential goods. Industries that were exempt to this include the manufacturing of metals, chemicals, cement and other large power-consuming industries. Furthermore, the government also extended exemptions on workers dealing within the trade industry. This meant that companies involved in the import and export of both essential and non-essential good could continue operations. The government also announced that although operations would continue, companies needed to reduce their capacity. This falls in line with social distancing regulations.
The European Commission announced the closure of land borders between Schengen states. This meant that travel between countries would be restricted for essential services including, for the purpose of import and export.
How Are Industries Navigating Import and Export In Spain
Although the IMF foresees a decline of at least 3% within the import and export sector, the export of fresh produce showed positive growth during the first half of lockdown. Fruit export grew by 10% with a shipment totalling a value of €1.592bn. However, the strawberry market did not share the same success. Strawberries fell by 3.4% in export volume, while vegetables saw a decline of 2% during March.
As a result of the confinement measures to contain the virus, the economy saw a remarkable decline in the import market. With global trade restrictions in place, this led to the difficulty of accessing some raw materials for the purpose of production. The country saw a decline in the consumption of both local and imported products.
The Royal Decree 463/2020 allowed for the sale of essential goods within the Spanish territory. This meant people could shop for basic necessities. Likewise, most e-commerce stores remained opened regardless of the sale of non-essential items. As a result of COVID-19, the WTO foresees a global merchandise trade decline of anything between 13% – 32%. These numbers are according to a report published on the 8th of April. Collectively, studies find a 2020 European decline of 12% for exports and 10% in imports. It also points out that trade could see a fall in sectors with complex value chains. Industries likely yo be affected include, electronics and automotive products. Both these industries’ decline is mainly due to the imposed transport restrictions.
Read more on how the rest of Europe’s import and export restrictions are playing out during this global pandemic. These are the import and export restrictions in Italy.