Title page

Contents

1. Introduction 3

2. COVID-19 3

2.1. Timeline of economic effects 4

2.2. Price volatility and shortages 7

2.3. Policy responses and the aftermath 8

3. The Russian invasion of Ukraine 9

3.1. Energy shock 9

3.2. Agriculture 13

3.3. In perspective: the shock and the response 18

4. The China-US trade war 19

4.1. The Trump-Biden trade wars 19

4.2. The chip wars 20

4.3. The impact 21

5. Policy lessons from a decade of trade shocks 23

References 24

Figure 1. Pandemic-period household savings rate 5

Figure 2. Pandemic retail turnover of non-food products (except fuel) and services in the EU27 6

Figure 3. Freight rates 7

Figure 4. Used versus new cars CPI, United States 8

Figure 5. Last price TTF futures 10

Figure 6. European vs US natural gas prices 11

Figure 7. Energy subsidies by economic sector in the EU27, € billions (2022 prices), 2015-2022 12

Figure 8. Change in EU industrial output: Q3 2022 vs Q3 2021 13

Figure 9. Wheat futures 14

Figure 10. Fertiliser prices 15

Figure 11. Wheat and wheat flour prices on the world market and in China, India and Indonesia (January 2018 = 100) 16

Figure 12. Evolution of the share of global trade, in calories, impacted by export restrictions 16

Figure 13. Wheat and grain prices (January 2000 = 100) 18

Figure 14. The US-China trade war: US-China tariff rates toward each other 19

Figure 15. Chinese imports of integrated circuits vs crude oil 21