Global trade is expected to plummet this year in the wake of President Donald Trump’s tariff offensive, fuelling uncertainty that threatens “severe negative consequences” for the world, the World Trade Organization warned.
Since returning to office, Trump has imposed a 10 percent tariff on imports of goods from around the world along with 25 percent levies on steel, aluminium and cars.
While Trump made a U-turn on steeper tariffs for dozens of countries, he has escalated a trade war with China, slapping 145 percent levies on Chinese goods while Beijing retaliated with a 125 percent duty on US products.
“I’m very concerned,” WTO chief Ngozi Okonjo-Iweala told reporters on Wednesday adding that the organisation expected to see trade volumes between the United States and China crumble by a whopping 81 percent.
“The enduring uncertainty threatens to act as a brake on global growth, with severe negative consequences for the world, the most vulnerable economies in particular,” she warned in a statement.
In the start of the year, WTO expected to see global trade expand in 2025 and 2026, with merchandise trade seen growing in line with global GDP, and trade in services growing even faster.
But in the organisation’s annual global trade outlook published Wednesday, it determined that as things stand, world merchandise trade is on course to fall 0.2 percent this year, “before posting a modest recovery of 2.5 percent in 2026”.
The 2025 number, calculated in line with the tariff situation on April 14, is already nearly three percentage points lower than what would have been expected without the tariffs Trump has slapped on countries around the globe
