The evidence is mounting that March marked the start of a global recession. And according to the World Trade Organization, that might be the optimistic scenario.
The breadth of the collapse is beginning to appear in the initial trickle of economic data across the world, revealing a cratering of trade, reined-in business investment, cowering consumers and surging unemployment that's sparing few industries.
The hit to demand is visible on the world's oceans, where a measure of US export volumes in the first two full weeks of March showed shipments abroad at less than half the year-earlier level, IHS Markit data compiled by Bloomberg showed. The damage is acute for autos: The number of anchored ships used to transport vehicles has jumped to 19% of the fleet, up from 11% a year ago, according to Bloomberg data.
The World Trade Organization says 2020 trade could fall as much as 32%
After the US on Friday reported a higher-than-expected job losses, other figures for March have illustrated how the Covid-19 pandemic is extending the paralysis from producers to households, from big trading powers to more insulated economies and emerging markets.
In Germany, new-car registrations in March -- usually a peak month -- plunged 38% from a year earlier, and a reading in the UK tanked 44%. Three of the biggest Arab economies buckled, a services index in Brazil was the lowest since 2016 and vehicle sales in South Africa slid 30%. In Australia, which has dodged recession for three decades, job advertisements plummeted by the most since 2009, even though the nation didn't go into a strict lockdown until late in the month.
Roberto Azevedo, the director-general of the WTO, said of its just-revised outlook for global trade and economic growth: "These numbers are ugly -- there is no getting around that."
The Geneva-based arbiter of international commerce predicted a range of scenarios, from an "optimistic" 13% drop in global merchandise trade that would rival the Great Recession of 12 years ago to a pessimistic plunge of 32% rivaling the Great Depression of the 1930s.
The optimistic view would mean a 2.5% contraction in global GDP this year, the WTO said, while the worst-case scenario would see an 8.8% decline.
The wide variance reflects much uncertainty over the WTO's forecasts, and the ultimate outcome will depend on how quickly the virus is contained and supply chains rebound. Azevedo urged countries to work together rather than adopt export barriers in fighting the outbreak.
"If countries work together we will see a much faster and robust recovery than if each country does it alone," he said.
The bleak outlook echoes projections from the International Monetary Fund and the World Bank, which are both expecting a major downturn this year, as well as the increasingly gloomy projections of private economists.
The already-receding global economy is losing steam faster than in the early days of the financial crisis, according to Bloomberg Economics' new global GDP tracker. The reading for March shows the global economy contracting at an annualized rate of 0.5%, compared with 0.1% in February.
From India to Italy, coronavirus lockdowns have closed businesses and kept billions of people homebound for weeks, provoking a simultaneous supply and demand shock that's snarled global production and logistics networks built without sufficient capacity to absorb a jolt of this magnitude.
Companies including Airbus SE in Europe and FedEx Corp. in the US have cautioned in recent days that it's too early to estimate the length of the slump or assess the damage -- displaying a level of uncertainty that stretches into supplier networks of small firms, often located in rural areas and developing economies. That's spurred governments in Europe and the US to rush aid to small businesses to prevent more from closing permanently.
Airbus, with about 135,000 workers, told employees in a letter sent late last week that a return to full operations isn't feasible in the short term because of parts shortages and the inability of struggling airlines to take delivery of new aircraft.
In a regulatory filing on Friday, FedEx warned that an "extended period of global supply chain and economic disruption could materially and adversely affect our business" and "an extended global recession" would add even more strain. International sales make up more than half of the revenue at FedEx, which employed 177,000 last year.
The parcel-delivery company added that it's taking steps to manage cash flow and liquidity, "including review and consideration of opportunities and strategies for capital expenditure reductions and deferrals."
With investment set to slide and more people out of work, global GDP rates could dip lower depending on how long governments maintain their lockdowns -- many of which are expected to last into May or June. The Paris-based Organization for Economic Cooperation and Development estimates that for each month of containment, there will be a loss of 2 percentage points in annual GDP growth.
Unless the virus is contained within several weeks, declining output and falling demand for trade may provoke a vicious cycle that only worsens the outlook for corporate investment and employment, compounding the labor market's problems.
Signs aren't yet pointing to a quick end and recovery. On Tuesday, Honda Motor Co. said it will stop paying furloughed workers at all of its 10 factories in the US for three weeks.
More than 10 million Americans filed claims for unemployment benefits last month, and the International Labour Organization warned almost 25 million jobs will be lost if the virus isn't quickly contained.
"Getting this right is predicated on social dialogue between governments and those on the front line -- the employers and workers," said ILO Director-General Guy Ryder in a statement, "so that the 2020s don't become a re-run of the 1930s."