EU Posts Large Trade Surplus as Imports Drop in 2020

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The Eurozone’s trade surplus posted record numbers in June, swelling to 21.2 billion euros ($25 million) as the bloc experienced a corresponding record decline in the importation of goods due to the Covid-19 pandemic, according to a recent report from Eurostat.

Putting a damper on these impressive figures, however, was the news that there was a concomitant record decrease in the GDP of the entire bloc in the last quarter, amounting to a decline of 12.1% compared to the first quarter of 2020, before the full ramifications of the coronavirus pandemic were experienced in Europe.

This latest GDP data is based on information gleaned from 13 of the 19 euro zone countries, including all the large nations, as opposed to an earlier Eurostat report, which included data from just the ten largest countries.

There was a simultaneous steep decline in the employment rates in the countries belonging to the Eurozone as well during this period. The employment numbers posted in the second quarter, between April and June, fell by 2.8% compared with the previous quarter, representing the most precipitous drop ever seen since the figures began to be recorded in 1995.

The Eurostat report stated that the EU’s trade surplus in June was larger than that seen one year earlier, when it saw an impressive positive balance of 19.4 billion euros. This was well in excess of the forecasted surplus of 12.6 bullion euros for that same month, and was twice as large as the May, 2020 surplus of 9.4 billion euros.

According to a Reuters report, this annual improvement in trade figures reflects a drop of 12.2% in imports, which more than offset the decrease in exports.

In the first six months of 2020, the EU’s exports to the rest of the countries of the world decreased by 12.7% compared to the same months in 2019, amounting to a drop of 1 trillion euros. However, the value of imports decreased even more, amounting to a decrease of 12.9%, or 869 billion euros.

Perhaps unsurprisingly, there was less trade taking place between all European countries during the worst of the months of the pandemic, when several nations experienced almost complete lockdowns.

June saw trade activity representing only 150.6 billion euros between all the 27 states of the bloc, representing a decrease of 7.3% compared to the same month in 2019.

The Eurostat report also noted that the nations of the EU traded much less with Great Britain compared to last year, constituting the largest trade decrease in any single market during the first six months of the year. After formally leaving the UK in January of 2020, exports fell a precipitous 21.5% compared to the same period in 2019.