Assessing the Impact of the COVID-19 Pandemic on Commodities Exports from Commonwealth Countries

Abstract

This paper considers the salience of commodities in Commonwealth members' merchandise trade and estimates the impact of the COVID-19 pandemic on the commodities exports to five main markets: China, the USA, the European Union (EU-27), the UK and Australia. The analysis finds that commodities constitute almost half of Commonwealth countries' global merchandise exports but the share for 35 commodity-dependent Commonwealth countries is above 80 per cent. The COVID-19 shock has been perceived as a global negative shock hurting all sectors and all markets. Overall, the results suggest that dependency patterns have at best been maintained because of the pandemic shock. At worst, and especially among highly dependent commodity exporters, the pandemic has further accentuated a fragile macroeconomic situation already under pressure as a result of heightened price fluctuations in several commodity markets.