The World Trade Organization (WTO) has significantly lowered its forecast for global goods trade growth this year. This reflects the ripple effects of tariff measures imposed by the Trump administration in the United States.
On the 16th (local time), the WTO released a press release forecasting the global goods trade growth rate at -0.2% for this year. This figure represents a significant downward adjustment compared to the forecast (3.0%) presented last October.
U.S. President Donald Trump recently imposed a 25% tariff on specific items such as steel and automobiles and announced reciprocal tariffs for trade partners. Although the implementation of reciprocal tariffs for each country was postponed for 90 days, a retaliatory tariff battle with China ensued, with some item tariff rates exceeding 100%.
The WTO stated, "If President Trump fully reintroduces the currently suspended reciprocal tariffs, the growth rate of global goods trade could drop an additional 0.6 percentage points (p), and the resulting ripple effect could lower it by another 0.8 percentage points (p)." It explained that including these effects, a total decline of 1.5% is anticipated, the largest drop since the direct hit of the COVID-19 pandemic in 2020.