Impact of COVID-19 on the trade of goods and services in Spain

TL;DR

The paper analyzes how COVID-19 caused a severe decline in Spain's trade, especially in services dependent on mobility, with a focus on the differential recovery prospects for goods and services post-pandemic.

Contribution

It provides an empirical assessment of COVID-19's impact on Spanish trade, highlighting sector-specific vulnerabilities and recovery expectations.

Findings

Trade in goods may recover quickly after the health crisis.

Trade in services reliant on mobility faces long-term negative effects.

Spain's export specialization intensified the trade impact.

Abstract

The COVID-19 crisis has led to the sharpest collapse in the Spanish trade of goods and services in recent decades. The containment measures adopted to arrest the spread of the virus have caused an especially intense fall of trade in services. Spain's export specialization in transport equipment, capital and outdoor goods, and services that rely on the movement of people has made the COVID-19 trade crisis more intense in Spain than in the rest of the European Union. However, the nature of the collapse suggests that trade in goods can recover swiftly when the health crisis ends. On the other hand, COVID-19 may have a long-term negative impact on the trade of services that rely on the movement of people.