Explanation:
Strict travel restrictions are preventing business partners from different countries from meeting in person. This column explores the effect of business travelling time on trade using data from the library of Soviet air space in 1985, which radically reduced flight times between Europe and East Asia. The findings reveal that travelling time can account for most of the trade frictions that cause bilateral trade to sharply decline with geographical distance, suggesting that the current travel restrictions could have large negative effects on trade.
As countries work to contain the global spread of the novel corona virus, -19, some are taking more drastic measures than others, including closing borders, banning travelers, quarantining foreigners, and rejecting cruise ships from docking at their ports.
“It is enshrined in international health regulations that countries should do their best to keep borders, travel, and trade open during these periods.”
Global trade has taken a great hit in the wake of the current pandemic. In the second quarter of this year, global merchandise trade saw the sharpest quarter-on-quarter decline ever recorded, falling by 14.3% compared to the previous period. The WTO forecasts a 9.2% annual decline in merchandise trade for 2020 (WTO 2020). Much focus has been directed towards the initial breakdown of supply chains as well as issues related to the distribution of food and medical supplies. The breakdown of many supply chains has also served as a reminder of how dependent countries are on trade, and especially of how important China is as a supplier of inputs to
the rest of the world
Border closures, travel restrictions
Beyond China, other countries have also taken an aggressive approach to containment. Last week, Russia announced it would temporarily ban Chinese citizens from entering the country – a move it took after closing its land border with China and Mongolia. Dozens of other countries have also instituted bans on Chinese visitors. Iran’s neighbors have closed their borders as cases in the country rise. North Korea has quarantined foreigners.
Impacts on the response, allocation of resources
“It is enshrined in international health regulations that countries should do their best to keep borders, travel, and trade open during these periods,” Morrison said. “It multiplies the sense of crisis and it creates blockages to the passage of critical personnel and medical products. It’s highly problematic, in all of those ways.”
Effectiveness of travel restrictions
Many in the international community have credited travel restrictions, quarantines, and border closures with limiting the cases in countries outside of China.
“What is known is that by restricting the immigration of people who have been exposed or could have been exposed is curtailing the spread of the disease. Finding effective ways to continue doing that is going to be critical, if we are going to avoid the kind of worldwide pandemic the World Health Organization
