impact of the crisis on globally engaged firms. Although this finding is intuitive, given that most countries were impacted by the pandemic, it should, nonetheless, be taken with a grain of salt since our results are based on a small sample including only the trading firms that report their top destination and source countries. Yet, we do find significant differences in the recovery of firms exporting to high–income countries relative to those exporting to non-high–income countries (Figure 9, panel a). In contrast to the recent evidence for French exporters by (Lafrogne-Roussier et al., 2021), firms in the BPS data trading with China were not disproportionately affected. The initial impact and recovery path of such firms are comparable with those trading with other non-high income countries. The severity of the initial lockdown in response to the pandemic in destination and source countries also did not affect the magnitude of globally exposed firms’ sales decline in the initial and latest survey rounds (Figure 9, panels c and d).

Figure 9: Impact of trading partner’s characteristics on change in sales <!-- Start of picture text --> (a) By top export destination’s income (b) By top import source’s income<br>0 0<br>-20 -20<br>- 27 -29<br>-40 -34 -40 - 34 -36 -34<br>-44<br>-51 -51<br>-60 -51 -50<br>-60 -54<br>High-income Non-high income China High-income Non-high income China<br>Top Export Destination Top Import Source<br>First round Latest round First round Latest round<br>P-value of test that exporters with top export destination a high income country P-value of test that exporters with top export destination a high income country<br>are different that those to non-high income and China are different that those to non-high income and China<br>First round: Non-high income 0.295; China 0.965 First round: Non-high income 0.553; China 0.807<br>Latest round: Non-high income 0.051; China 0.660 Latest round: Non-high income 0.508; China 0.919<br>Change in sales (%) Change in sales (%)<br><!-- End of picture text -->

- (c) By top export destination’s severity of initial lockdown (d) By top import source’s severity of initial lockdown

<!-- Start of picture text --> 0 0<br>-20 -20<br>-30 -29 -34 -33<br>-40 -40<br>-47 -48<br>-51<br>-54<br>-60 -60<br>Destination: low mobility drop Destination: high mobility drop Source: low mobility drop Source: high mobility drop<br>Top Export Destination Top Import Source<br>First round Latest round First round Latest round<br>P-values: First round: 0.431, Latest round: First round: 0.792 P-values: First round: 0.168, Latest round: First round: 0.401<br>Change in sales (%) Change in sales (%)<br><!-- End of picture text --> _Notes:_ The sample includes 667 exporting firms and 1,195 importing in 13 countries in all panels. In panels c and b countries are split above and below the median severity of their initial lockdown, i.e., in the first survey round.

# **5.4.2 Sectoral Attributes**

Globally engaged firms in manufacturing and services sectors were better able to cope with the negative external shock caused by the pandemic than those in the agriculture sector. Specifically, the total sales decline in the recovery phase (relative to 2019) for firms in manufacturing was the 20